Bitcoin is a Store of Value, Ethereum is Powering the Crypto Economy

May 07, 2021, 5:30 PM AEST (updated May 21, 2021)

Bitcoin and Ethereum: The World’s Largest Cryptos

They are the King and Queen of the crypto market and for very good reasons, and can’t really be compared directly because they have very different uses cases – as explained below.

  • Bitcoin is a store of value asset
  • Ethereum is a framework powering crypto projects

Both BTC and ETH adoption is now going mainstream and it’s important that we understand the purpose of them so we don’t compare apples with oranges when deciding between them.

Bitcoin is a store of value asset

Bitcoin was originally designed to be a transactional peer-to-peer cash system as per Satoshi’s Bitcoin whitepaper. However, it has since been altered into a store of value as it cannot cope with the scaling of transactions as transaction fees soar.

Having a limited supply of 21 million Bitcoin on the BTC blockchain, and a decreasing supply – this makes it a scarce asset, and therefore, valuable to investors. Learn more about Bitcoin.

Investors worldwide have realised alternative Bitcoins store of value and been adding BTC to their personal portfolios, while institutions have been adding it to their balance sheets.

Ethereum is powering the crypto economy

Ethereum on the other hand, was developed to address the “flaws” of Bitcoin and has evolved dramatically over the past few years into “programmable money”, as per the Ethereum whitepaper.

Ethereum powers crypto projects and ecosystems:

Ethereum also is set to become a deflationary asset as it upgrades to Ethereum 2.0 hardfork in July 2021. This will see some Ether “burned” on every transaction, decreasing it’s supply.

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