The Ethereum blockchain offers a distributed consensus system with no central authority. On the other hand, Bitcoin is powered by an open-source, peer-to-peer network with a definite hierarchy in terms of power and influence. The platform has paid extraordinary attention to detail while designing its user interface. Furthermore, people want to know how to make legit money with Ethereum.
Ethereum is often discussed as an alternative to Bitcoin and has even been referred to as "Bitcoin 2.0" because it does not have any scaling issues that currently plague Bitcoin transactions. In addition, the Ethereum blockchain can process substantially more transactions per second than legacy systems like Visa or SWIFT, making it much more scalable and adaptable for financial use cases beyond simple international remittances or payments at retail stores like Starbucks shortly.
It's hard to believe, but only a fraction of a percent of the global population has heard of or used Bitcoin, as we can see from its market capitalization. Likewise, the Ethereum blockchain is not nearly as widely known as bitcoin, and it remains to be seen if it will become more widely used next to its predecessor.
The network adds some exciting features to the bitcoin ecosystem that could overshadow it in the future. Ethereum developers and enthusiasts will likely offer some alternatives to Bitcoin via specific tasks and features as there are already significant forks on the Ethereum blockchain, with some new contenders behind others. An efficient system does not store information but also acts upon it. Smart contracts, while they can be implemented into Bitcoin's blockchain, are not a system itself. The Ethereum protocol offers a lot of other utilities and possibilities that remain very intriguing for developers. Let's discuss whether ethereum can ever replace bitcoin or not.
Smart contracts- An innovative technology that bitcoin does not have:
Smart contracts are the main feature that distinguishes Ethereum from other blockchain platforms. It is not just a simple form of a digital contract but also a code that performs actions according to its terms.
In this way, it has the potential to streamline processes and eliminate third parties in much of the financial services industry (stock exchanges, crowdfunding platforms like Kickstarter, and most ICOs), as well as in government administration (land registries, voting systems).
Ethereum is more scalable than bitcoin:
Some problems are inherent to Bitcoin and can't be addressed because of design constraints. For example, the blockchain was always intended for peer-to-peer transactions, mostly between individuals, with no additional intermediaries. Therefore, any change in the design of the bitcoin protocol will require a hard fork, which may be incompatible with the current setup.
Ethereum, on the other hand, is built from scratch to allow you to build your applications, which attracted significant corporates like Microsoft and IBM as they don't have to build their entire infrastructure themselves.
Ethereum\'s consensus model and proof of stake:
The main difference between Bitcoin and Ethereum is that in Ethereum, the consensus is built on a different model. The consensus mechanism in Ethereum is Proof of Stake (PoS), which uses ether as a deposit for participants to make their bets on blocks going through. Participants with the most ether win rewards while they can still be kicked out at any time. This process is not 100% automated but instead relies on an automated system that verifies all transactions.
Ethereum has a longer chain than bitcoin and is, therefore, more reliable:
As we mentioned earlier, Bitcoin is designed to be a point-to-point digital currency, while Ethereum allows you to build your application on it. Therefore, some compare Ethereum to Bitcoin with their transaction speed and scalability.
It isn't entirely true because many companies claim their blockchain service is as fast as or faster than bitcoin, including Ripple, which was recently named the most efficient technology platform for cross-border payments.
However, developers should be aware that the Ethereum blockchain can process substantially more transactions per second than legacy systems like Visa or SWIFT, making it much more scalable and adaptable for financial use cases beyond simple international remittances or payments at retail stores like Starbucks shortly.
Ethereum is a platform that runs smart contracts:
The main difference between Bitcoin and Ethereum is that in Ethereum, the consensus is built on a different model. As a result, participants with the most ether win rewards while they can still be kicked out at any time.
Ethereum has its programming language:
Bitcoin has a scripting language that allows users to program transactions but doesn't allow developers to do much beyond simple transactions. Moreover, since it features a Turing-complete programming language, it allows developers to build all sorts of applications on top of it, attracting significant corporates like Microsoft and IBM as they don't have to build their entire infrastructure themselves. Ethereum can potentially disrupt bitcoin and will likely overtake it in the future. First, Bitcoin is a highly intimidating and complex cryptocurrency for ordinary people.