Are you considering buying cryptocurrency, but you’re afraid to make a big mistake? What coin should you buy?
Analysts expect the market size for cryptocurrency to grow about 6 billion USD in the next 5 years. That’s a compound annual growth rate of 7.1%.
Should you go with a new disruptive technology or stick with what you know when it comes to crypto? What’s the difference between Bitcoin and Ethereum?
Here’s a guide to comparing Ethereum vs Bitcoin.
What Is Bitcoin? (BTC)
Bitcoin cryptocurrency was created as an alternative to international monetary systems. So how does Bitcoin work?
It uses blockchain as a way to secure transactions. There’s no public authority over Bitcoin. It’s become a way to send and receive payments to anyone in the world.
What Is Ethereum? (ETH)
Ethereum is a network and a coin. The developers issued ETH to fundraise and develop the network.
Ethereum uses blockchain technology in its network. The network uses its own programming language that runs on blockchain. It’s a software platform where a user can deploy a smart contract.
People trade Ethereum in the same way as other cryptocurrencies. You can buy and hold it for its value. It’s also used on the Ethereum network to run applications. If you want to buy Ethereum, you can purchase it in an exchange.
Ethereum vs Bitcoin: A Summary
Both Ethereum and Bitcoin use blockchain technology to secure transactions.
Bitcoin was designed as a currency. It is mainly a medium of exchange and a store of value. Ethereum was designed as a platform where users can easily program contracts and applications, using ETH as payment.
Other Coins or Alt Coins
Most crypto exchanges and businesses in the space issue their own coins. They use these coins to fundraise and develop their business. Users can purchase these coins or tokens as an investment. They can also obtain tokens by completing tasks for the network.
You can use exchange-issued coins to pay fees, sometimes at a reduced rate. At Polygon, you can search for the Matic price to find the current market rate for their token.
What Are Meme Coins?
There are tokens or coins that are fun and have been created by individuals or groups as an experiment to see how popular they may become. One coin you might be familiar with is the Dogecoin.
Another meme coin is Dogelon Mars or ELON. If you research this coin, you can see it’s based on a story about a dog that travels to Mars.
Avoid coins that don’t have a true use or utility in the crypto space, as they are extremely risky investments. Your personal level of risk tolerance is a good guide.
Making a Choice Takes a Bit of Research
Selecting the right cryptocurrency to invest in will depend on your understanding of the factors involved. When you understand the differences between Ethereum vs Bitcoin, it makes crypto easier to grasp. You’ll be happy you did your research before you make your decision.
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