As reported by CoinDesk, the analogy is being made by analysts and experts where bitcoin is the digital gold in the market as it has a limited supply. At the same time, ethereum is being hinged off as the digital silver. At the moment, however, those interested in investing in either coin can only do so by trading on a cryptocurrency exchange or by depositing funds into an exchange. With its ether (ETH) currency, ethereum is billed as a decentralized Launchpad with nearly identical attributes to the bitcoin blockchain. Check out the importance of cryptocurrencies in today’s growing world.
The analogy between bitcoin and gold:
Bitcoin is being compared with gold as there’s a limited supply, which appeals to investors looking for haven investments. Gold, however, has a few advantages over bitcoin as it is used in industry, jewelry, and electronics making people more receptive to the metal than its crypto-counterpart. However, tech-savvy people have favored bitcoin since its inception as gold has offered prolonged returns in the last year, whereas bitcoin has grown from $0.0000089 to $69000 in just 12 years.
The analogy between Ethereum and silver:
On the other hand, ETH (Ether) is being compared with silver as it is less popular than bitcoin; moreover, ETH is more bitcoin in circulation. As actual gold has more value than silver, BTC also has a higher value than Ethereum. Silver miners can mine correspondingly higher than bitcoin, and some go off with ether. Secondly, ether’s value tends to be more volatile than bitcoin’s, making it a more attractive speculative investment than bitcoin’s.
Finally, while Ethereum is not as valuable as bitcoin, some analysts have said the supply in circulation is only enough to support roughly a quarter of the number of transactions that bitcoin can process per second. It suggests that Ethereum might have space for growth but may not surpass its rival.
Similarities
Price volatility:
Crypto-currency Ethereum is also less stable than bitcoin in terms of value. As a result, many experts have said that Ethereum is a cryptocurrency to watch out for in 2022 as the value of ETH is expected to soar. Regulation:
Government agencies in many countries monitor Bitcoin and Ethereum. It means bitcoins can be bought, sold, or traded like a commodity. The SEC also noted that some companies have begun to sell bitcoins in exchange for the US dollar. On the other hand, few other countries have declared cryptocurrencies illegal.
Transaction time:
Transaction fees are different from bitcoin and ethereum; let’s discuss these. People are also comparing it with bitcoin as ether was released in 2015 and bitcoin was first introduced in 2009, while ethereum takes a little over 10 seconds to process a transaction and bitcoin takes a minute or even longer. The scalability of ethereum will skyrocket after the arrival of ethereum 2.0 as it will be able to handle more transactions in a second than bitcoin.
Transaction time is one of the significant factors that can affect the price of a cryptocurrency, as it will determine how long it takes to complete a transaction.
Scalability:
Ethereum has agreed to speed up its transaction but is yet to do so. Still, even when scaling issues are resolved, it may not be enough for ethereum to overtake bitcoin in terms of value and usage as bitcoin’s proponents argue that its size appears capped. Another critical factor for ether is that it has been marketed as a platform for building smart contracts, which are automated scripts of code that perform functions on a blockchain instead of relying on third parties such as banks or governments.
Why can ethereum not take over bitcoin?
Bitcoin’s supporters argue that scaling issues can have a resolution by increasing the size of blocks on its blockchain. So it is because miners will be able to process more transactions on a popular fork of bitcoin should it develop faster.
Besides bitcoin, ethereum is also challenged by other cryptocurrencies, such as Ethereum Classic (ETC), which has a market cap of $80 billion compared to ethereum’s $400 billion. Finally, price volatility suggests that ether has yet to offer investors enough stability to be used for trading against fiat currencies such as the US dollar and the euro, as well as bitcoin.
