Bitcoin VS Ethereum – The major differences

By Lumai Mubanga. [email protected]

Ethereum and Bitcoin are the two most popular blockchain platforms in the world today, but have two different goals. In a way, Bitcoin is referred to as the “gold standard” of blockchain. Although it is a well-known fact the founders of bitcoin are unknown as opposed to the founders of Ethereum, What are the major differences?

Bitcoin has been around the world for the longest, almost 6 years older than Ethereum and its protocol has successfully supported an enormous number of transactions over the past years. Its intended purpose is specifically to allow the transaction of bitcoins, its native asset. These transactions come as a result of bitcoin mining that gives bitcoin as an incentive.

On the other hand, Ethereum is a smart contract blockchain platform, a distributed world computer. Its native asset ether exists to fund computation and to align incentives. Its primary purpose is not to act as a medium of exchanging value.

Bitcoin is simple and robust. It’s a global payment system is solely based on digital currency. That’s all it really stands for and its main purpose and objective. Ethereum has a much larger vision and strategy, and therefore supports many more complex features. For Example, it is supported by a much more powerful scripting language. Bitcoin has a stack based primitive scripting language which is not Turing complete, meaning that the applications we can make on Bitcoin are very limited. Ethereum on the other hand has a Turing-complete scripting language. This was one of the motivating factors for Ethereum’s creation in the first place. So, a wider variety of applications can be made on Ethereum than on Bitcoin, making it more developer friendly platform.

Another key difference is that Bitcoin is UTXO-based, whereas Ethereum is account based.

So, as opposed to bitcoin, conclusively on technical and operational aspects, Ethereum has a high level architecture. Ethereum’s main goal is not to optimize computational efficiency, but to enable trustless computation and distributed. Every computer on the network has to run the same computations. This enables Ethereum to be redundantly parallel. And this is further allows for consensus to be reached efficiently reached on the system without needing trusted third parties.