Ethereum vs Bitcoin: key differences between the biggest crypto rivals
Bitcoin and Ethereum are the two most well-known cryptocurrencies available today, with the former established in 2009 by the anonymous Satoshi Nakamoto and the latter proposed in late 2013 by Vitalik Buterin. Despite the fact that both cryptocurrencies share many similarities, their concepts and purposes are different.
Since its release in 2009, Bitcoin has been the undisputed leader of the crypto revolution. Countless imitators have come and gone but Bitcoin remains strong and dominant. However, over the past 4 years, Ethereum has also proved that it is here to stay, being Bitcoin’s strongest rival.
The main difference between Ethereum and Bitcoin originates from their conceptual design. Bitcoin strives to become a secure, censorship-resistant value system outside of the traditional financial realm. Contrarily, Ethereum is designed as a ‘decentralised world computer’, which Turing-complete functionality allows users to build and run applications on the network through the Ethereum Virtual Machine (EVM).
Their concepts. When you think of Bitcoin, think of digital money. When you think of Ethereum, think of smart contracts. Bitcoin intends to be a literal store of value, a ‘digital gold’ of its kind, and is expected to eventually become a globally adopted currency – fully replacing conventional money in the foreseeable future. The purpose of Ethereum, on the other hand, is to become a giant platform upon which smart contracts and decentralised apps can run.
Their purposes. When you think of BTC vs ETH, you should consider their purposes. Bitcoin’s objective is to help people send money peer-to-peer without involving any third parties, removing the need for banks or any other payment processors. With Bitcoin, you control your own money: you can send it anywhere at any time and the fees are consistent. It doesn’t matter whether you send Bitcoin to your neighbour or to someone on the other side of the world – you won’t pay more. Its entire purpose is to provide a means of transferring value while granting you full control over your funds.
Ethereum is designed as a platform to facilitate peer-to-peer contracts and applications via its own currency means. It has its own cryptocurrency, Ether, which is investable and tradable as part of the platform. Unlike Bitcoin, the main purpose of Ether is not to establish itself as a payment alternative but to facilitate and monetise the working of Ethereum to allow developers to build and run distributed applications, also known as dApps.
Their supply. Bitcoin is limited to 21,000,000 coins. This creates supply and demand, which is healthy for a store of value. Ethereum, however, is not limited, making the production of Ether continuous.
How the Ethereum vs Bitcoin charts look today
Bitcoin has made a stunning turnaround in 2019, and its price seems to be invincible after looking at the rush it is presently following. In May, Bitcoin jumped by almost 60%, marking its best monthly performance since December 2017. On 27 May, the cryptocurrency surged up to $9,090, however, it didn’t last long and fell over 11% in a matter of minutes. On 16 June, BTC again leapt across the $9,000 mark, hitting $9,311 peak. At the moment of writing, Bitcoin was trading between the $9,100 – $9,300 price range, with its price up 140% since the beginning of the year.
Trade Bitcoin to US Dollar - BTC/USD CFD
Currently, the market capitalisation of Bitcoin is around $163 billion, with a 24-hour volume of over $21 billion. The current circulating supply is 17,763,562 BTC.
Ethereum has also been moving fast and furious, making constant progress. In the past six months, it is performing its best now, reaching the $279 mark on 16 June. Currently, ETH price remains in a positive zone and trades above the $270 resistance against the US dollar.
Price forecasts for BTC and ETH: what the future holds
The most recent price fluctuations in both Ethereum and Bitcoin value have drawn many into price forecasting. It is believed that 2020 will prove to be the most remarkable year for Ethereum and other cryptocurrencies.
Bitcoin has gone through lots of ups and downs. However, big names in the crypto industry are sure that Bitcoin has finally recovered after the eighteen-month-long cryptowinter, foreseeing its success and prosperity.
Wences Casares, the CEO of Xapo and Bitcoin evangelist, has recently said that BTC value might surge by at least 250 times in the foreseen future. Tim Draper, another famous Bitcoin enthusiast and crypto billionaire, stated that in only years, Bitcoin will be everywhere and fiat currencies will become archaic; he predicted the Bitcoin price to hit $250,000 within four years.
Elon Musk, the founder of SpaceX and Tesla, called Bitcoin "brilliant" in public and said BTC is better than old-school paper money as it can transfer value. Fran Strajnar, the founder and CEO at Techemy Ltd, also has very high hopes for BTC, believing it might reach $200,000 by January 2020. One of China’s biggest OTC traders and Bitcoin billionaire, Zhao Dong, has recently predicted that BTC might go as high as $50,000 by 2021, saying that now is the best time to invest in this cryptocoin.
In addition, Bitcoin implementation is growing at a rapid pace. NASDAQ, the second largest stock exchange in the world, has announced its plans to launch Bitcoin futures in the first half of 2019. Bakkt, a cryptocurrency payment system and digital assets trading platform, is going to be introduced to the masses later this year. An asset management giant Fidelity is also looking to join the Bitcoin trading foray in 2019. Even Bitfury Group, together with a South Korean R&D firm, is launching a network of Bitcoin mining centres in Paraguay.
According to statistics, Ethereum’s dApps have more than 110,000 daily active users, who perform 1.79 million transactions on a daily basis. Joseph Raczynski, the founder of Joe Technologist.com and a blockchain enthusiast, predicts that the value of Ethereum might go up to $1,000 by the end of 2019. Ian McLeod, a technology expert at Thomas Crown Art, believes that ETH can hit $500 in 2019, as it might experience a global and monumental breakout.
According to the TradingBeasts.com website, the price of Ether might get as high as $908 by the end of this year, with the average price revolving around $650. Brian Schuster, the founder of Ark Capital LLC, made another bullish and optimistic guess, stating that ETH might reach $100,000 in the next 5 years and will eventually replace gold with crypto. Ethereum's co-founder, Steven Nerayoff, in an interview with CNBC said that Ethereum price might get tripled, estimating its value to reach $3,000 by the end of 2019.
Truth be told, nobody has a crystal ball to predict the future. However, in the long term, both Ethereum and Bitcoin’s advocates may just be right – the virtual sky may be the only limit for the cryptocurrencies. Today, it does seem increasingly apparent that the markets are in a steady uptrend that will likely continue in the foreseeable future.
Ethereum vs Bitcoin: which one to choose?
Choosing whether to invest in Ethereum or Bitcoin can be rather difficult, as both cryptocurrencies offer many advantages. In the last two years, the value of these has skyrocketed, giving potential investors many positive promises. As with any investment, it’s always best to arm yourself with as much knowledge as possible before throwing your hard-earned cash at it. However, the one thing about BTC and ETH is certain – these have a strong fundamental basis, a large fan base with many followers and a reputation of the most advanced blockchains available today. So, if you’re looking for relatively stable crypto to invest in, you should definitely keep your eye on BTC and ETH.
Check out our latest article on what you can buy with Bitcoin in 2019.
*Mention that this article should not be construed as financial or investment advice.