The native cryptocurrency of the Ethereum network is ETH (Ether), the most popular digital token in the cryptocurrency world, next to Bitcoin (BTC). Although they share many similarities, many significant differences do exist. This article focuses on the differences between ETH and BTC. Anyone interested in cryptocurrency and blockchain ought to know these differences, which becomes handy at junctures like investment decisions, use cases, market dynamics, and community and ecosystem.
In spite of the differences and similarities between these two crypto tokens, they are unique in their own way. Just read on for a better insight.
What is a Blockchain?
The most coveted blockchain technology creates waves of innovation in cryptocurrency with its unique strategies, policies, and principles. Blockchain is a decentralized, distributed, public digital ledger that records transactions across numerous computers. Blockchain technology is an advanced database mechanism that allows information sharing within a network transparently. In a blockchain database, data is stored in blocks linked together in a chain. Blockchain works on the key principles of cryptography, decentralization, transparency, immutability, security, consensus mechanisms, interoperability, incentive structures, and confidentiality and privacy, collectively creating an intensely secured underlying software system that’s impossible to tamper with. Some of the concepts of blockchain technology include distributed ledgers, cryptographic hash functions, and smart contracts. All the concepts and principles of blockchain technology are pivotal in bringing it to where it stands now.
Ethereum Vs. Bitcoin
Bitcoin uses the consensus Proof of Work (PoW) protocol that permits network nodes to agree on the state of all information recorded. It prevents selected types of attacks on the network. Ethereum shifted to Proof of Stake (PoS) in September 2022. PoS is a set of interconnected upgrades that intensified Ethereum’s security and sustainability. Though both BTC and ETH are digital currencies, the primitive purpose of Ethereum is not to rise as an alternative monetary method. Rather, it is to monetize and facilitate smart contract operations, dApps, and other feasible blockchain solutions. However, Bitcoin was birthed as an alternative to traditional currency to be a decentralized digital cash system.
Bitcoin is intended more as a general-purpose currency for day-to-day payments, while Ethereum is designed specifically for payments on the Ethereum network. Although BTC has smart contracts, their flexibility isn’t as complete as Ethereum’s. Moreover, it lacks all the functionality a programming language could bestow. The programming languages used are Script and Clarity. Ethereum permits us to create smart contracts. Programming languages used are Solidity, Vyper, and so on.
Bitcoin runs on the SHA-256 hash algorithm, while Ethereum runs on the Keccak-256 hash algorithm. BTC transactions take about 10 minutes to complete a block, while Ethereum takes an average of 13-15 seconds per block. Bitcoin’s PoW consensus mechanism isn’t very scalable. The network can handle a maximum of only seven transactions per second. On the other hand, Ethereum’s PoS consensus mechanism is highly scalable, potentially processing up to 30 transactions per second.
Ethereum and Bitcoin’s Impact on Online Gambling
Ethereum and Bitcoin have influenced the online gambling industry with tangible impacts, such as anonymity and privacy, transparency and fairness, global accessibility, lightning-fast transactions, considerably lower transaction costs, innovative gaming models, and regulatory challenges. Of these impacts, anonymity and privacy, transparency, fairness in transactions and gaming, global accessibility, lightning-fast transactions, and negligibly low transaction costs cluster under the advantages zone. However, the challenges include volatility, regulation uncertainties, security concerns, varying user experience, and scalability.
Platforms utilizing Ethereum for gambling purposes include Decentralized Casinos (CryptoKitties and FunFair) and prediction markets like Augur for bitcoin price prediction. Casinos showcase a plethora of games like Ethereum slots, baccarat, table games, lotto, and so on. Platforms utilizing BTC are Bitcoin casinos and Bitcoin sports betting platforms. These also exhibit a wide range of casino games.
The Final Word
Though Ethereum stands a step higher than Bitcoin in its transaction speed, both are equally beneficial. The choice of the cryptocurrency solely depends on your nature of usage and prospective interests in it. Needless to mention, cryptocurrency is carving niches in numerous online games and has become the most successful domain in the financial realm to be looked up at. As regulations evolve and technological innovations like AI and VR boost up, cryptocurrency gambling will fly with psychedelic hues in the mainstream soon.