A large number of non-cryptocurrencies believe that it is only about Bitcoin. This is normal since it is the most popular and most expensive currency. However, many digital currencies compete with Bitcoin for their position and leadership, and the most prominent of them is without a doubt Ethereum.
Cryptocurrencies depend on the way they work on blockchain technology. It is a completely decentralized and secure technology. Therefore, Bitcoins or transactions made with them cannot be traced.
Despite the similarity in concept and technology used, Ethereum is very different from Bitcoin in many ways, and the reasons for establishing each of the two currencies were different.
Bitcoin as a cryptocurrency
Bitcoin and Ethereum are used for the same tasks, namely fast and secure payment. However, the two currencies differ from each other in the reason for their establishment.
Satoshi Nakamoto established Bitcoin to be a digital currency used to pay, purchase, and complete transactions, without any intermediary or parties other than the sender and recipient. On the other hand, Ethereum can be considered an operator of digital currency networks and applications.
Bitcoin is obtained by mining it using computers with high specifications. Because it is safe and easy to use and trade, it has reached all users around the world.
It has also reached those with bad intentions, which has gained a bad reputation and made the governments of many countries resist it.
Currently, this currency is the most widespread and most accepted by sellers or even some institutions such as Tesla. To fast food outlets and auctions.
Nasdaq said in 2021 that more than 45 million US citizens own Bitcoin, and more than 15,000 sellers or institutions accept it as payment.
The currency has achieved huge growth in price and monetary value. This is what turned it into “digital gold.” Its price is expected to continue to increase, given that its number in the world is limited to only about 21 million coins. This is what made some view it as a long-term investment.
Ethereum as a cryptographic digital network
Ethereum was launched in 2015. It is operated by a free community based on open-source software. Amounts are traded through it based on its features such as smart contracts, and dealing with Ethereum does not waste the user any time or need to wait, with the feature of resisting fraud and preventing interference from external parties.
In addition to its use in trading, it is considered a secure programming basis for many decentralized applications, which are also known as Dapps, short for Decentralized Apps.
These various types of applications rely on the same Ethereum blockchain, so they are completely secure and the operations that take place through them cannot be traced. Of course, most decentralized applications are financial applications.
One of the most important applications of the Ethereum network is decentralized finance (DeFi). It is a type of financial system that does not suffer from any discrimination or system downtime.
DeFi can be used just like finance products and services, as money can be sent or received as well as borrowed and interest earned.
