There has never been a better time to invest in cryptocurrencies. With fiat currencies facing global disruption due to social, political, and economic upheaval – digital and alternative currencies are seeing a dramatic increase in not just their popularity, but their value as well.
While some may dismiss their power as nothing more than a passing phase, those in the know are confident that cryptocurrencies such as Bitcoin and Ethereum will continue to get more popular, and could one day pose a viable alternative to standard, centralised money.
If you have decided to dabble in this new and exciting world, knowing which currency to opt for can be a somewhat difficult choice to make. Bitcoin and Ethereum are without a doubt, the best performing and most well-known cryptocurrencies available, and as such, they offer great potential for those looking to invest.
There is much debate over which is better than the other, and while Bitcoin is the most popular, it is Ethereum that has the most potential for growth. So why is Ethereum a better investment than Bitcoin? Let us find out.
What sets them apart?
While Bitcoin has long been the dominant coin in the market, it is now finding itself facing some stiff competition from Ethereum, due to the hype surrounding its additional features and applications.
The main difference between Ethereum and Bitcoin is that the former is not just a digital currency. It is a blockchain based platform that offers users many features such as smart contracts, the Ethereum Virtual Machine, and of course, ether for its peer-to-peer contracts. It is, in essence, digital technology, not just a form of currency.
Bitcoin, on the other hand, is essentially a “digital dollar”. It acts in the same way as a fiat currency, except that it is not centralised, physically tangible, or regulated by any formal entity such as a bank. In other words, it is your money but held in a digital form.
Pros and cons of Ethereum
Ethereum is a decentralised digital platform that offers smart contracts which are written in Turing computer programming languages like Solidity. Ethers were then created as a “cost” for programmes that need to run in Ethereum. As long as Ethereum runs, Ethers will always be required to execute the code within the platform, and as most projects now are built on top of Ethereum – this means that it is a currency that exhibits the best long-term potential overall.
The only con when it comes to Ethereum is that the value of each Ether is tied to the success of the platform itself so there is always a possibility that a competitor could come along with a similar project and gazump the Ethereum network.
Pros and cons of Bitcoin
Bitcoin is by far the most well known and most well-established cryptocurrency in the world. It is anonymous, decentralised and its value is increasing (apart from a few blips) at a steady upwards trajectory. It is by far the most accepted and the easiest to trade cryptocurrency available, and it benefits from sufficient online resources and support so that even beginners can get to grips with it in an instant. Due to its large community and following, this means it is unlikely to disappear or rapidly devalue meaning, on the whole, it is a pretty good investment.
When it comes to cons, Bitcoin suffers from a high transaction fee and scaling problem. As the average mining time of each coin is around 10 minutes and the blocks are limited to 1MB, it means you can only allow three transactions each second. This means either you encounter delays, or you pay a more substantial transaction fee to prioritise your transaction.
Why Ethereum comes out on top
We have seen in recent news that the future of Bitcoin is a little unstable. With China taking significant steps towards curtailing and possibly even banning the use of the currency within the country, who knows how many other states will follow suit.
On the other hand, Ethereum has not experienced (yet) any such adverse reactions from governments or official organisations. The fact that the number of Ethers available is unlimited, as well as its tie to the Ethereum platform, means that it is in a much stronger position to both grow exponentially over time, as well as retain its status as a leading currency.
While the future of Bitcoin can appear to hang in the balance from certain angles, it seems that Ethereum is in a much more stable long-term position. For those that are considering investing in cryptocurrencies, or even just expanding their portfolios it would look that Ether is the way to go.