Ethereum vs Bitcoin
| Comparison | Bitcoin | Ethereum |
|---|---|---|
| Launch Date | 2009 | 2015 |
| Founder | Satoshi Nakamoto (Anonymous) | Vitalik Buterin |
| Primary Use | Store of Value, Payments | Smart Contract Platform |
| Total Supply | 21 million (Fixed) | No Hard Cap |
| Consensus Mechanism | Proof of Work (PoW) | Proof of Stake (PoS) |
What is a Smart Contract?
A smart contract is a program running on the blockchain that automatically executes when conditions are met, without needing an intermediary.
Analogy: A vending machine. You insert a coin (meet the condition), the machine automatically gives you a drink (execute the contract), no need for a salesperson (intermediary).
Ethereum was the first major blockchain to support smart contracts, making it the foundational infrastructure for the entire crypto ecosystem.
Main Uses of Ethereum
DeFi (Decentralized Finance)
On Ethereum, you can lend, trade, and earn interest without going through a bank. Uniswap, Aave, and Compound are all DeFi applications on Ethereum.
NFT (Non-Fungible Token)
Most NFTs are issued on Ethereum, representing ownership of digital art, in-game items, and more.
Token Issuance
Most cryptocurrencies (ERC-20 tokens) are issued on Ethereum, such as USDT, LINK, and UNI.
The Role of ETH
ETH is the native currency of the Ethereum network, with main uses including:
- Paying Gas fees (any operation on Ethereum requires ETH to pay transaction fees)
- Earning rewards through Staking
- Serving as a store of value and investment asset