Find out more about the two most famous cryptocurrencies.
Ethereum and Bitcoin are the two most famous cryptocurrencies. Nonetheless, they have several functional and structural differences in their operation. These include:
- Ethereum has an average block time of twelve seconds, while Bitcoin averages 10 minutes. Accordingly, the Ethereum blockchain has significantly faster transactions.
- Bitcoin is inherently a scarce economic model because block rewards halve every four years. For Ethereum, it is different because the network releases the same amount of Ether every year.
- Ethereum will use Proof of Stake mining going forward while Bitcoin retains Proof of Work mining.
- In Ethereum mining, you get no advantage for pool mining because of the network’s Ghost protocol and Ethash algorithm. This system inherently discourages centralized mining. For Bitcoin, the more powerful your equipment, the more competitive your mining operation.
- The final and most significant difference is that while Bitcoin is exclusively a transaction platform, Ethereum is both a transaction and development platform thanks to its virtual machine that enable smart contracts. The Ethereum blockchain allows the creation of decentralized applications (dapps), which facilitate all manner of commerce. Ethereum is, therefore, more generic as it can support different types of transactions once a developer writes logic into the Ethereum smart contract.
The era of decentralized apps
Dapps are a game-changer for the cryptocurrency industry. With digital currency adoption still at lower than desirable levels, dapps offer a means to an end. They offer a practical way for people to use cryptocurrencies. These platforms don’t merely provide utility services but are a way for developers to control and monetize their creative content in a democratic way.
Therefore, dapps can disrupt all manner of sectors. Be it gambling, gaming, and decentralized finance, among others. For instance, EOS dynasty is an EOS gaming dapp that has a 24-hour transaction average of 69,890. As the first RPG and PvP game on the blockchain, it has proven quite popular with users. Such a dapp presents an opportunity for people who wouldn’t otherwise use crypto to get into this space. The game has different levels and incentives to let users play and earn.
The key advantage of Ethereum is the versatility dapps bring to this industry. Even though Bitcoin is still the dominant coin, the utility value of Ethereum dapps, as well as other dapps, will endure.
Nonetheless, all that glitters is not gold. Past events would advise that it is better to first assess the viability of dapps before deciding to invest. With the proliferation of all kinds of vices in this sector, DappRadar’s classification of high-risk dapps is more crucial than ever.
Ethereum dapps will continue to play a vital role in boosting crypto adoption even as Bitcoin settles into a more store-of-value/speculative asset.