While both Bitcoin and Ethereum operate on blockchain technology, they have different goals, functionalities, and technical specifications. Bitcoin is primarily a digital currency, whereas Ethereum is a platform for decentralized applications and smart contracts.
Bitcoin and Ethereum: How Do They Differ?
- Bitcoin aims to replace national currencies and act as a store of value
- while Ethereum aims to utilize blockchain technology for maintaining a decentralized payment network and storing computer code.
- Bitcoin has limited smart contract functionality
- while Ethereum allows for the creation of smart contracts, which are computer codes stored on a blockchain and executed when predetermined terms and conditions are met.
- Bitcoin uses the Proof-of-Work (PoW) consensus mechanism
- while Ethereum uses the Proof-of-Stake (PoS) consensus mechanism.
- Bitcoin has a block time of 10 minutes
- while Ethereum has a block time of only 14 to 15 second.
- Bitcoin has very high energy consumption
- while Ethereum’s is much lower
- Bitcoin is the most popular digital currency
- followed by Ether, the native currency of Ethereum.
- Bitcoin transactions are generally for keeping notes
- while Ethereum transactions may contain executable code.
- Bitcoin runs on the SHA-256 hash algorithm
- while Ethereum runs on the Keccak-256 hash algorithm.
- Bitcoin has a block limit of 1 MB
- while Ethereum does not have any block limit.
- Bitcoin miners receive nearly 6.25 BTC for successfully adding a new block
- while Ethereum miners receive nearly 5 ETH along with additional rewards for successfully adding a new block.
Specifically:
Bitcoin is a decentralized digital currency that can be transferred on a peer-to-peer (P2P) network without the need for any central authority. Its transactions are stored in an immutable distributed ledger called the blockchain.
- The BTC is a passively managed exchange-traded fund offering exposure to the daily USD spot price of Bitcoin, less expenses and liabilities,
- has a management fee of only 0.15%, which is the lowest in the sector and includes all of the costs associated with administration and safekeeping of the underlying Bitcoin. There are no other fees.
- currently has $4.03B in assets under management,
- trades on NYSE Arca, and
- is available through your brokerage account.
Ethereum is a blockchain-based distributed platform designed to be scalable, decentralized, and programmable.
- The ETH is a passively managed exchange-traded fund offering exposure to the daily USD spot price of Ethereum, less expenses and liabilities,
- has a management fee of only 0.15%, which is the lowest in the sector and includes all of the costs associated with administration and safekeeping of the underlying Ethereum. There are no other fees.
- currently has $875.6M in assets under management,
- trades on NYSE Arca and is available through your brokerage account.:
