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Comparison to Bitcoin

Ether is different from Bitcoin (the cryptocurrency with the largest market capitalization as of January 2018) in several aspects.

  • Its block time is 14 to 15 seconds, compared with 10 minutes for bitcoin.
  • Mining of ether generates new coins at a usually consistent rate, occasionally changing during hard forks, while for bitcoin the rate halves every 4 years.
  • Transaction fees differ by computational complexity, bandwidth use and storage needs (in a system known as gas), while bitcoin transactions compete by means of transaction size, in bytes.
  • Ethereum gas units each have a price that can be specified in a transaction. This is typically measured in Gwei. Bitcoin transactions usually have fees specified in satoshis per byte.
  • Transaction fees are generally considerably lower for ether than for Bitcoin. In December 2017, the median transaction fee for ether corresponded to $0.33, while for bitcoin it corresponded to $23.
  • Ethereum uses an account system where values in Wei are debited from accounts and credited to another, as opposed to Bitcoin’s UTXO system, which is more analogous to spending cash and receiving change in return. Both systems have their pros and cons; in terms of storage space, complexity, and security/anonymity.
  • Ethereum is planned to transfer to full Proof-of-Stake, currently it is a hybrid between Proof-of-Work and Proof-of-Stake. This scheme is commonly known as Casper Friendly Finality Gadget (FFG), whereas the pure Proof-of-Stake system is known as Casper Correct-by-Construction (CBC). Mining becomes obsolete during Casper CBC, via an exponential difficulty bomb in Ethash.

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