Ethereum, with a market cap of $221.6 billion, had a market share of just short of 19%. Bitcoin has also experienced change, introducing the Taproot upgrade to enable smart contracts. The Bitcoin Lightning Network is another project being worked on as a second-layer protocol that intends to take transactions off-chain for the purpose of speeding up the network. Bitcoin uses a consensus protocol called proof of work (PoW), ethereum vs bitcoin which allows the network nodes to agree on the state of all information recorded and prevent certain types of attacks on the network. In September 2022, Ethereum moved to proof of stake (PoS), a set of interconnected upgrades that will make Ethereum more secure and sustainable. To address issues regarding scalability, part of the transition to proof of stake is sharding, which will continue to be addressed through 2023.

Moreover, investors are continuing to monitor gas fees (i.e., transaction fees) on the Ethereum network. These fees are at their lowest levels since 2020, and have been on a downward trajectory since the start of the year. Generally speaking, low gas fees signal low network activity, and there has been much hand-wringing about how much less demand there has been by all the biggest users of the Ethereum blockchain. Bitcoin has remained the number one, though some experts believe Ethereum will supersede the original cryptocurrency, sooner or later. With the guide, you will also learn how to buy your first Bitcoin using a cryptocurrency broker.

To be clear, that doesn’t mean the rise in all cryptocurrencies will continue indefinitely over the long term. As for the trading platform, you have hundreds of options, though it does not mean that all platforms are suitable for all kinds of traders. These platforms can be either designed explicitly for crypto trading or to support cryptocurrency investments and many other assets.

Before joining Forbes Advisor, John was a senior writer at Acorns and editor at market research group Corporate Insight. His work has appeared in CNBC + Acorns’s Grow, MarketWatch and The Financial Diet. If you invested $1,000 in Ethereum in August 2015, your investment would be worth a staggering $2.23 million almost six years later.

Global trading and investment platform eToro, which specializes in cryptocurrency trading and has a nine-million-strong online community, has produced a short educational video about the rise of Ethereum. The crypto market has slowly bled out since January 2018 but we experienced a positive bounce in recent years, especially in 2021. As for the hardware wallets, these are physical devices that keep your private keys offline; that’s why they are considered the most secure wallets. These wallets are cold storage, and they are specially designed for those who want to keep larger amounts of Bitcoin and don’t make transactions too often. If you prefer buying a hardware wallet, we would recommend Trezor wallet and Ledger Nano S wallet.

For example, Account A will release Asset X once it has received Asset Y from Account B. This could be used to make property sales and the transfer or ownership faster and less liable to fraud. Proof of work systems such as Bitcoin have drawn a lot of criticism for the amount of energy expended by the computer hardware involved. Bitcoin currently uses 19 terawatt hours (TWh) of electricity per year.

Notably, it went from a high of almost $4,000 per coin in May 2021 to less than $1900 in June 2021. If you had bought in at its high, you’d be sitting with half that value just a month later. Here’s how to get started buying Ether, the official name of the token more commonly called Ethereum because of its association with the Ethereum platform that it powers. AIS facilitates the self-directed transfer from an existing IRA to Digital Trust Company. Digital Trust Company is
a non-fiduciary trust company, registered and regulated in the state of Nevada as a non-depository trust company.

Why invest in Ethereum over Bitcoin

It was also the first cryptocurrency  to appear on the market, and at one point was worth more than a trillion dollars. BTC reached a high of almost $69,000 in November 2021, but the following May dropped below $US20,000. Ethereum is the the second-largest cryptocurrency with a market capitalisation at $US198 billion and as of September was worth $US1620. The cryptocurrency market is unregulated in Australia, although consumer advocacy organisations, such as CHOICE, are lobbying for greater protections for those who fall victim to scams and huge losses. For now, the Australian Securities and Investments Commission (ASIC), through its Moneysmart website, advises crypto investors to be exceedingly cautious when dealing in this volatile asset. Regardless, and as is the case with all cryptocurrencies, BTC and ETH are both volatile.

So, it is regarded as a commodity by the Commodity Futures Trading Commission; SEC classifies it as a security, while according to the Treasury, Bitcoin is a currency. Bitcoin trading is regulated in the US by the Bank Secrecy Act and must register with the FinCEN. For more information about the taxes applicable to Bitcoin, visit the IRS website, the section of FAQs, or review its Notice about virtual currencies. But this requires consistent research, so you must always keep an eye on the market, follow the price charts and market trends, as well as pay attention to experts’ analyses and tips. Apart from the technical analyses, you also need to do fundamental analysis and consider the risks of a bitcoin crash. It’s also a good idea to follow the news, pay attention to its public endorsements, what companies start accepting payments through Bitcoin, etc.

However, Forbes Advisor Australia cannot guarantee the accuracy, completeness or timeliness of this website. Ether (ETH), the native cryptocurrency of the Ethereum network, is the second most popular digital token after bitcoin (BTC). As the second-largest cryptocurrency by market capitalization (market cap), comparisons between Ether and bitcoin are only natural. At the end of the day, the biggest motivation for anyone interested in cryptocurrency investment is the potential for high returns. Although crypto investments can be a highly volatile option in the short run, they can be pretty decent ways to make big money in the long term. For example, Bitcoin, the most well-known cryptocurrency, has seen a significant increase in value over the past few years, making it a popular investment choice for those who are high-return hunters.

Why invest in Ethereum over Bitcoin

If you’re selling crypto, though, you may want to consult a tax professional. Despite its decentralized nature, crypto is taxable in the federal government’s eyes. Your profits from the sale are typically subject to capital gains taxes and can significantly affect how much you owe the IT department come tax time.

This would positively impact because more people using and buying Bitcoin increases demand, which will increase the price as the supply is capped. Ether (ETH) is the second-largest cryptocurrency by market cap and is the native asset of the Ethereum blockchain and economy. While part of the same product, ETH and Ethereum are distinctly different – Ethereum is a blockchain network, and ETH is the currency used on that network.

To buy Bitcoin on, sign in to your account and click on the “Markets” section where you will find the cryptocurrencies available on the platform and some price and volume tracking charts. You will find the BTC/USDT pair on the top of the chart, so click on the “Trade” button next to it and more graphs will be available to analyze the market. You can buy Bitcoin with zero trading and transaction fees using an ACH transfer option, but you must pay a 2.99%-3.99% fee when making a transaction through a credit card. Also, the platform charges taker and maker fees and withdrawal fees which vary depending on the coin you want to withdraw. However, we should notice that charges relatively competitive fees compared to several other exchanges. Investing in Bitcoin can seem like an intimidating task at first, but our recommended platform eToro has made investing in Bitcoin and other cryptocurrencies easier than ever!

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