16 June 2020

Meta description: Investing in Ether and BTC can be very profitable, but you have to take into account price fluctuations. This is because the prices of cryptocurrencies are subject to supply and demand conditions. In this article, we will be reviewing features of both cryptocurrencies to help you decide on which to invest in.

Investing Outlook: BITCOIN OR ETHEREUM

First of all, it is important to understand what Bitcoin and Ethereum are, before analyzing the similarities and differences between these two cryptocurrencies.

Bitcoin and Ethereum are well-known cryptocurrencies. They refer to the new form of digital currency that is used as a value trading tool within a distributed network of users (peer-to-peer) without the need for intermediaries. Bitcoin was the first cryptocurrency created, so it is naturally the most famous. It was launched in 2009 by pseudonymous developer Satoshi Nakamoto.

The main objective of Bitcoin was to create an independent and decentralized digital payment system based on mathematical tests and cryptography. Unlike traditional banking systems, BTC transactions are tracked via a public digital book (called Blockchain).

Similarities Between Bitcoin And Ethereum

Ether and Bitcoin are global digital currency that allows people to own their money instead of allowing banks or other financial institutions to keep it.

The system that these cryptocurrencies run on is based on the blockchain, which is a tamper-proof record of all transactions on the network, accessible to all participants.

Although BTC and Ether are not yet recognized as a formal means of payment, they have created a solid standing in the financial sector.

Difference Between Ethereum And Bitcoin

It is essential to understand that despite the constant comparison between Ethereum and Bitcoin, the two are different projects with entirely different goals.

TECHNOLOGY

Bitcoin may not rely on the fastest blockchain technology, but it is the first and most famous. Most importantly, Bitcoin is still making big waves in the Fintech industry and seems to be here to stay.

On the other hand, Ethereum technology is incredibly exciting for developers and countries around the world. It is intended to facilitate Smart Contracts and the development of new applications in a decentralized world.

In general, the uses of Etheruem are much broader than the uses and capabilities of Bitcoin, since Ether can be used as a cryptocurrency just like Bitcoin while having other practical, real-world applications. In contrast, Bitcoin can only be used as an online cryptocurrency to make payments and exchange money online.

Supply And Market Capitalization

Bitcoin has a limited supply, which means that the system will not generate more BTC once the maximum supply is reached. Although it varies from project to project, Bitcoin’s maximum supply is set at 21 million units. Unlike Bitcoin, Ether follows an inflationary system where there is no established market capitalization. Instead, around 18 million Ether tokens are released each year. As of this writing, more than 100.8 million ETH tokens are in circulation.

The supply of Ether is unlimited, and the availability of Ether is unlimited. It is not affected by the use of individuals. In contrast, the supply of Bitcoin is limited and implemented by miners.

Bitcoin is more liquid in the sense that it is intended to be exchanged for goods and services. With its limit of 21 million on the coin market, this can create scarcity, which can increase the value of Bitcoin. At the time of writing, there are only 17.97 million BTC coins in circulation.

Conclusion

Ethereum and Bitcoin were not created to compete, as they have entirely different goals and applications. Both Cryptos have incredible applications and potential for differing reasons. That is why they are the two most popular cryptocurrencies on the market.

Still wondering what to invest in?

Keep in mind that Bitcoin is the first of its kind, so it leaves a strong impression in the financial sector, which facilitates its use as a buy, sell and trade currency.

Ethereum comes with great technology, and its development potential and real world applications are significant. As it has managed to gain acceptance from several institutions, it may seem like an excellent opportunity to be the next big investment.

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Investing in cryptocurrency shouldn’t require you to be a computer scientist or banker. With our exclusive analysis & investing tools, investing in crypto has never been more simple.​

Edmund McCormack
Tech industry veteran and blockchain technology investor. Simplifying cryptocurrency for almost a decade.

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