The cryptocurrency has come a long way in the past few years, experiencing soaring highs and crushing lows. Throughout the industry’s tumultuous history, Bitcoin has reigned supreme as the most valuable cryptocurrency.
Bitcoin may have been the progenitor of the cryptocurrency industry, but various other cryptocurrencies, known as altcoins, have pushed the market forward in innovative ways that Bitcoin simply hasn’t.
Ethereum has consistently been hot on the heels of Bitcoin as the number two cryptocurrency in terms of value and market capitalization. Let’s look at a few reasons why Ethereum is better than Bitcoin.
1. Smart Contracts
Ethereum has made a name for itself in the Decentralized Finance (DeFi) space by using its blockchain platform to host smart contracts. By using the Ethereum Blockchain, users can create and execute smart contracts. Smart Contracts are digitalized contracts on the blockchain, that allow two parties to carry out transactions in a secure manner, making sure neither party can scam nor shortchange the other.
A smart contract is only carried out once specific terms and conditions are met. For example, if Person A is selling property and Person B is buying the property, a smart contract would ensure that Person B only receives the documents proving their ownership once the decided amount has been paid and is in Person A’s account.
Smart contracts offer efficiency and security that simply can not be matched by traditional means. As the most popular platform to support smart contracts, Ethereum has a significant role in the future of DeFi.
2. Decentralized Apps
The Ethereum blockchain is an open platform where anybody can upload their own apps and other various blockchain creations. Furthermore, these decentralized apps (dApps) can be monetized using Ethereum cryptocurrency, allowing developers to earn cryptocurrency through their apps and other products and services on the blockchain.
Supporters of blockchain technology feel confident in the future of decentralized applications, as they can not be controlled or regulated by third parties. dApps provide users more privacy than traditional smart apps. This concern has risen amongst many consumer market segments in recent years. As the market grows, most people investing in blockchain technology will realize that Ethereum is better than Bitcoin for the future of DeFi.
Ethereum is focused on continuing to provide developers with the best possible decentralized platform. Developers have consistently reported that Ethereum is one of the best and most accessible platforms to develop dApps. As the market for decentralized apps grows, we will see this technology used in various industries, such as video games, social media, and e-commerce.
Cryptocurrency mining has always had a significant carbon footprint, but making their platform eco-friendlier has been a top priority for Ethereum. As a result, Ethereum drastically reduces its energy consumption and carbon footprint with each new update.
Ethereum intends to transition entirely to a proof-of-stake system by the end of this year, which they claim will reduce its energy consumption by 99.95%.
The need for environmental reform has been an important debate for many years, and most cryptocurrencies have earned a bad name for themselves simply because of how much energy they consume. For example, in May of 2022, it was revealed that Bitcoin consumes an estimated 62 terawatt-hours of energy annually.
Suppose Ethereum successfully reduces its carbon footprint as much as it aims to. In that case, it will prove to the cryptocurrency market and the world that Ethereum is better than Bitcoin for society’s future.
As an ever-changing platform, it’s impossible to accurately predict what Ethereum could look like in the near future or its role in our lives. For example, will Ethereum make future apps more secure to use? Or will it be the backbone of transactions in various industries such as real estate and finance? Will Ethereum ever be the bastion of a digital, eco-friendly future? Although the future remains uncertain, one thing’s for sure; it’s no surprise why many people already believe Ethereum is better than Bitcoin.