Bitcoin (BTC) is the biggest and best-known cryptocurrency on the planet, but many experts are now tipping its main rival Ethereum to start challenging it for pole position in 2018.
Ethereum’s digital currency, known as Ether (ETH), has soared in value over the past 12 months, appreciating by nearly 12,500 percent.
This time last year, a single Ether token was worth less than ($10), compared to more than ($1,240) today (January 12).
Despite its remarkable rise, Ethereum still trails far behind bitcoin, which is now worth more than ($14,000) per coin.
Bitcoin’s market capitalisation is also almost twice as much as Ether’s – ($227billion) compared to ($120billion).
For those new to cryptocurrency, here is a handy guide outlining the main differences between bitcoin and Ethereum.
What’s the difference between bitcoin and Ether?
Both bitcoin and Ether are digital currencies based on blockchain technology that can be used to send money across borders without the need for a traditional bank.
The cryptocurrencies can also both be “mined”, unlike Ripple tokens, meaning users can earn bitcoin and Ether from home – provided they have the right equipment.
Click on the following link for more information on bitcoin mining: HOW TO MINE BITCOIN
However, bitcoin and Ethereum have fundamentally different purposes.
Bitcoin was created back in 2009 as an alternative to money, whereas Ethereum is more of a platform that facilitates companies building new applications and programs.
Ethereum’s website insists that its own currency “would never have been possible without bitcoin” and that the two cryptos are “complementary within the digital ecosystem”.
The website explains: “Ether is to be treated as “crypto-fuel”, a token whose purpose is to pay for computation, and is not intended to be used as or considered a currency, asset, share or anything else.”
The recent explosion in the value of cryptocurrencies has prompted excitement among financial experts.
Steven Nerayoff, who co-founded Ethereum, believes that Ether will continue to surge in 2018.
Speaking to CNBC, he said: “What you’re seeing with Ethereum is exponential increase in the number of projects — there are billions of dollars being poured into the ecosystem right now — maybe 10 times more projects this year than last year, which could easily lead to a doubling, probably a tripling in price by the end of the year.”
Mr Nerayoff added that bitcoin is likely to grow alongside Ethereum.
“The entire space is increasing,” he said. “There is huge interest by the public and there are more areas in which the public can invest, even in bitcoin, so you could just see an expansion in the entire space.”