Bitcoin vs. Ethereum: what's the difference?
The two largest cryptocurrencies were built for different jobs. Here is how they compare on purpose, supply, technology and risk.
Bitcoin and Ethereum together make up most of the value of the crypto market, but they aren't competing to do the same thing.
At a glance
| Bitcoin (BTC) | Ethereum (ETH) | |
|---|---|---|
| Launched | 2009 | 2015 |
| Main purpose | Digital money and store of value | Platform for apps and smart contracts |
| Supply | Capped at 21 million | No fixed cap; part of each fee is destroyed |
| Security model | Proof of work (mining) | Proof of stake (since 2022) |
| New blocks | About every 10 minutes | Every 12 seconds |
| Smallest unit | Satoshi (0.00000001 BTC) | Wei (10-18 ETH) |
| US spot ETFs | Since January 2024 | Since July 2024 |
Bitcoin: a fixed-supply asset
Bitcoin was designed as money that no government or company controls. Its defining feature is scarcity: there will never be more than 21 million bitcoin, and new supply is cut in half roughly every four years. The most recent halving was in April 2024, and the next is expected around 2028. Many investors treat bitcoin like digital gold.
Bitcoin's scripting is deliberately limited, which keeps the network simple and conservative. Faster payment layers such as the Lightning Network are built on top.
Ethereum: a programmable platform
Ethereum is a shared computer that runs smart contracts: programs that hold and move money according to their code. Stablecoins, decentralized exchanges, lending apps and NFTs mostly run on Ethereum or on "layer 2" networks that settle to it.
Ether is the fuel for that computer: every transaction pays a fee in ETH. In 2022 Ethereum switched from mining to proof of stake, cutting its energy use dramatically and letting holders stake ETH for rewards.
Different risks
- Bitcoin depends mainly on continued demand for it as a store of value.
- Ethereum depends on its apps staying in use, and it competes with other smart-contract platforms such as Solana. Its more complex software also means a larger surface for bugs.
Both are volatile. Over long stretches ether has tended to swing more than bitcoin in both directions.
Do you have to choose?
No. Many investors hold both, often weighted toward bitcoin. Use the converter to see how many ETH one bitcoin buys today, and compare their sizes with the market-cap calculator.
This guide is for general education and isn't financial, investment, legal or tax advice. Crypto is volatile and you can lose money. Facts were checked as of the update date above; rules and fees change.