Bitcoin doesn’t have the entire stage to itself. There’s also Ethereum, along with the thousands of other cryptocurrencies each competing for a space in the Blockchain world. Bitcoin was the first ever cryptocurrency and that’s why it has the edge over other coins. But being the first to arrive on the scene also has some disadvantages. One of which is its outdated nature. Though Bitcoin might have undergone many upgrades in the past few years, its core makeup is still intact. Significant upgrades are often contentious, meaning the community usually struggles to decide if these upgrades should be actioned.
This gives Ethereum, being the second-most valuable cryptocurrency, a significant place in mainstream media. But Ethereum is more than just a cryptocurrency. So what makes it different?
#1 Ethereum Virtual Machine
Let’s put it this way; Ethereum is one talented blockchain-based platform. It can do multiple tasks thanks to its built-in Ethereum Virtual Machine (EVM). Interestingly, Ethereum’s main function is not as a cryptocurrency, but as a platform for smart contracts, made possible by the EVM and its peer-to-peer (P2P) network.
These smart contracts can be used to store Blockchain apps. These apps can then be used to facilitate contracts. Ethereum prioritizes security over anything else. You can use an Ethereum Wallet to store your Ether.
Mining on Ethereum is currently a proof-of-work algorithm, the same type of algorithm which Bitcoin uses. However, with the release of Casper, Ethereum will be switching to a hybrid proof-of-work/proof-of-stake algorithm. After this, they will gradually faze out proof-of-work and remain a proof-of-stake blockchain.
#3 Gas Transactions
Ethereum has a different approach in pricing its transaction fees. They call this the “Gas approach.” Gas follows a well laid-out pricing that corresponds to the complexity, bandwidth, and storage usage of each transaction.
Ethereum also has a Turing complete internal code which is capable of computing anything as long as there is enough time and computing power available.
#4 Personalized Digital Tokens
You can create digital tokens with the help of the “smart contract” nature of Ethereum. These digital tokens can be personalized and used to represent virtual assets or even stock shares.
What do you think of Ethereum? Do you think it can go head-to-head with Bitcoin soon? Sound off your thoughts in the comment section below! We’d love to hear from you.