7 Reasons Why Ethereum Could Soon Overtake Bitcoin
The past few years have become the years of cryptocurrencies, and people started investing more than ever before. All of them are hoping that these currencies can turn them into millionaires. However, investing in cryptocurrencies can be a little bit tricky – it’s never certain whether their value will go up or down. One day, you may be rich, while the other day you may lose it all. Right now, Bitcoin and Ethereum are the most popular and valuable cryptocurrencies. Nevertheless, even though Bitcoin is currently placed in the first place, some analysts predict that there is a chance that Ethereum could soon overtake it. What could be the reason for this? Continue reading, and you will find out!
Top 7 reasons why Ethereum could soon overtake Bitcoin that you should know about
1. Goals differences
Bitcoin was made to be the first decentralized paying method, that would give people an opportunity to carry out any transaction without the involvement of a third party, allowing them to have a fast and cheap transaction of the currency. On the other hand, Ethereum is a newer and more sophisticated currency, whose goal is to support “smart contracts” and decentralized applications (dApps), which would create ideal conditions for making a decentralized system in the future. This would give the programmers a chance to produce their apps, hence there lies the first reason.
2. Transaction execution speed difference
When living in a world where everyone expects things to be faster than usual, having a high-speed transaction execution is what people like to hear about. In the years 2020 and 2021, it took Bitcoin roughly ten minutes to complete the transaction procedure (which involves putting it into the blockchain and having it confirmed). This is a significant improvement over previous years when it took a couple of hours to complete. When it comes to Ethereum, the confirmation of a transaction might take from a few seconds to two minutes. Sounds amazing, right?!
3. Blockchain difference
Because the blockchain of Bitcoin was created as a relatively simple one, similar to the blockchain of the world’s first cryptocurrency, it’s easiest and best to describe it as a digital record of transactions in blocks that contains data on transactions conducted. Although they have many similarities, Ethereum’s blockchain is more advanced and elaborate than that of its major competitors. It can store codes and allows users to use blockchain more flexibly for their needs.
4. Difference in the amount of the tokens
The number of Bitcoin tokens that will be released is precisely and previously programmed and follows rigorous written restrictions, with a total of 21 million Bitcoin tokens being issued. On the other hand, Ethereum does not have a defined number of tokens that will end up on the market; instead, management and project owners decide how many tokens should be distributed or withdrawn from the market at any particular time.
EIP-1559 is a proposal made by Vitalik Buterin that proposes a significant revision to the present Ethereum transaction cost principle. Instead of the present 100% compensation to miners, a base fee is suggested. This includes a portion of the money that will be “burned,” as well as a tip for the miners (this will be optional). This idea might have a significant impact on the price of Ethers. Over one million Ethers would have been burned if this strategy had been implemented last year. The idea will most likely be implemented in July or August this year, with Ether potentially becoming a deflationary asset if transaction volumes maintain at current levels or expand further.
6. The difference in the mining approach
What is the mining process like for Bitcoin and Ethereum, and how does it connect to these two cryptocurrencies? Another point of distinction between the two cryptocurrencies is this. Even though both cryptocurrencies may be mined or discovered by mining, Ethereum is unique. Neither the processor nor the graphics card can run the Ethereum mining algorithm. If you wish to mine Ethereum, you can do it with your computer’s processor (CPU) or graphics card (GPU), which means you won’t be able to “monopolize” cryptocurrency mining as you can with Bitcoin. Another distinction between Ethereum and Bitcoin is that Ethereum does not allow “pack” mining, which is advantageous if you like to mine your coins. This means that you may mine Ethereum for profit, whereas “solo mining” with Bitcoin is pointless because “digging” something requires a lot of time and energy.
7. Smart contracts
Bitcoin, as a digital currency, is designed for a certain set of uses, serving as the asset of choice for investors looking for a haven investment. Ethereum, on the other hand, is more than a cryptocurrency. It’s a blockchain-based network that allows smart contracts, which are programs that can run automatically when specific circumstances are fulfilled. Decentralized Finance (DeFi) projects are also hosted on Ethereum. Smart contracts allow developers to create programs that do more than just send and receive money; these applications are referred to as decentralized applications or so-called Apps.
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We’ve arrived at a critical crossroads in history, where paper money is gradually being phased out in favor of cryptocurrencies. It is becoming more and more popular around every corner of the world. Since everyone is talking about cryptocurrencies nowadays, do you want to learn a little bit more about them?! If you want to know the latest news about currencies, their investment, mining, or anything cryptocurrency-related, you can read more here. If you’re not sure if investing in Bitcoin or any other currency is worthwhile, you’ll learn where to invest and what to buy. Their news reports usually feature facts and recommendations, as well as remarks from analysts and experts. It is undeniable that the Bitcoin price is extremely erratic, with no clear upward trend. So, if you need a bit of help and inside information, all of your questions will be answered there by true professionals.