Lots of folk who have had a recent interest in the rise of cryptocurrency ask themselves whether Ethereum will be worth more than Bitcoin. Many have taken the decision to buy ethereum on the hunch that it will out value Bitcoin. Some have watched a cryptocurrency youtube video or two and listened to an “expert” who claims that Ethereum is more useful than Bitcoin. Lots of people feel they’ve missed the Bitcoin “Rocket” and hope to catch the next best thing…. So there’s a common question intertwined within all the actions mentioned earlier…Will Ethereum be worth more than Bitcoin?
In order to make a decent judgment call it might be necessary to first determine the reason for Bitcoin and Ethereum’s existence. What are the underlying factors that make Bitcoin and Ethereum unique? Does Ethereum necessarily compete against Bitcoin? Read more about how cryptocurrencies work here.
In an attempt to prevent overloading you with “cryptocurrency” technical jargon , we want to give you the some tools to understand how to frame Ethereum and Bitcoin in the Cryptocurrency Era.
Bitcoin is basically decentralised technology that exists online – this means Bitcoin has no central control mechanism such as a company, a person, or a single group of people. Bitcoin’s improvements and changes are effected by groups of developers who make these changes to Bitcoin Core – a mechanism that forms the foundation of the Bitcoin blockchain protocol. Bitcoin works well as a store of value – this is because it is built to provide extensive security on a public ledger that is practically unforgeable and unalterable. In short, it can be trusted.
Bitcoin was the very first application of its time. If one could make an analogy it compares to the concept of using emails to reveal the potential and capabilities of the internet. It is true that it could be somewhat of a Gold 2.0 due to its scarcity. It is no mystery that there will only ever be twenty-one million Bitcoin produced. This fact brings us back to basic economics. When something is high in demand and has limited quantity then value tends to rise.
Ethereum is extremely complex in that it allows decentralised applications “Dapps” to be built on top of it. These Dapps allow for instructions to take place within a successful transaction – this is too complex for Bitcoin. It could be comparable to a vending machine which provides a particular item upon successful payment. Therefore multiple transactions take place as a result of the first transaction…payment for a chocolate bar. Ethereum is open source which means code can be written on top of existing code in order to improve or adapt its function. Unlike Bitcoin, Ethereum remains uncapped. Ethereum is not as secure as Bitcoin.
From our explanation above it is clear to see that Bitcoin and Ethereum have distinct purposes and that one is not simply “better” than the other. In fact, What Bitcoin lacks in, Ethereum makes up for and vice versa. Their existence could potentially be mutual and even complimentary.
This brings us back to our question: Will Ethereum be worth more than Bitcoin? It is difficult to say in the near term. From the outset, its like comparing apples to apple sauce. Its absurd to think that the value of apple sauce will become greater than apples but depending on usage pricing may fluctuate. Our belief though is that both cryptocurrencies, because of their unique resourcefulness, will see a rise in value in the foreseeable future. Ethereum more especially has a bright future ahead of it due to its potentially wide span in usage. This does not necessarily translate into a higher valuation.
Through the internet of money and in future, a real life application of Ethereum could include the sale of a house without an Estate Agent, Lawyer or Bank’s involvement in cancelling, securing bonds, making payment and transferring title deeds. All of these processes could potentially take care of themselves upon a single successful transaction. Ethereum will have the potential to strengthen decision making through Artificial Intelligence. With such great potential is it really possible to put a price tag on the value of ether?
Read more about investing in cryptocurrencies for beginners.