In 2009, Bitcoin was introduced and not many people knew about it. Over time, when people learned about the decentralization from fiat money, they learned they can be more free. No more worrying about your money being frozen from big banks and intermediaries like PayPal. You are your bank now. However, Bitcoin got much bigger than most people thought and it did that very fast. With its increase in price so quickly, it has suffered an increase in transaction fees and also a slowdown in its transaction speed. However, it is still useful. When Ethereum came out, it was looked down upon because the market hadn’t matured yet. No one understood much about cryptos beyond the peer to peer transfer. When the difference between Bitcoin and Ethereum was established, that is when we had a surge of the altcoin rush. This caused prices to skyrocket on all altcoins. It seems as if the roles have been reversed and there is more doubt on Bitcoin than anything else. This is why we recommend you hodl Ethereum over Bitcoin.
What is Bitcoin Used for?
With Bitcoins increase in price, it has been dubbed as gold 2.0 because of its store of value like feature. It is the most expensive cryptocurrency and it actually has the highest market cap. Bitcoin has also been the most resilient. It has the ability to drive the market up or down. If people start taking money out of Bitcoin, expect the whole market to come down. The vice versa also happens. With Bitcoins recently mempool always being full along with the transactions being so expensive, people are looking for other routes. There are upgrades that are expected to fix this but it doesn’t seem like it will be here anytime soon. This is called Lightning Networking and it will have an effect on many other cryptocurrencies too.
What is Ethereum Used for?
Ethereum was created by Vitalik Buterin and released in 2015. It is an open source public blockchain that lets people build on the blockchain. It can also be used a digital currency which it is at times. For example, if you decide to create an ICO with your own tokens, you will want people to buy your tokens somehow. You are thinking with a credit card but in cryptocurrencies, ICO’s are traded and paired with Ether usually. This means 1 eth is equal to a certain amount of your tokens. You must send your eth to a specific ICO address and receive your tokens that way. This is becoming bigger and bigger as more companies are looking to raise capital through the crypto markets rather than venture capital.
Why Ethereum will do better in the long term?
The future of ethereum contains a lot more hopes than Bitcoin does. Creating another Bitcoin is much easier than it is creating an ethereum that is running efficiently. We have many other coins that are working better as a peer to peer transfer of digital currencies like Litecoin and Vertcoin. We have been seeing Bitcoins dominance in market cap dropping down and with Ethereums market cap going up. The new Weiss Ratings increased confidence in Eth also.
- More use cases: Ethereum has many more use cases than Bitcoin does. Not only can you use it as a peer to peer transfer but you can also use it to create your own ICO. It is even used to put data onto the blockchain.
- Platform for ICO’s: You cannot just create your own cryptocurrency and expect it to run efficiently. This is especially true if you’re looking to do specific with your cryptocurrency than what is already being done. Cryptocurrencies with open source codes can be coped and started by another company but having the ability to have it on a platform that is already one of the best is hard.
- Mining to Staking: Ethereum has said they will be looking to move over from mining to staking as it is much more efficient and secure. Mining is the use of specific hardware that is used to confirm transactions on the blockchain. Staking also confirms transactions however it is done keeping your tokens or coins in your wallet.
This is a guest post made by Alex M. Alex has been very deep in the cryptocurrency space for the last 3 years soaking in everything there is to know. With such a new industry popping up, Alex is constantly sharing about the latest news and updates in cryptocurrencies on CoinPupil. To learn more about him and his work, read here.