Difference Between Blockchain And Bitcoin
For newcomers onto the cryptocurrency scene, “Blockchain” and “Bitcoin” seem to be two interchangeable terms. While these are the two most iconic terms in the cryptocurrency community, there are fundamental differences between them, and newbies would do well to learn how to differentiate Bitcoin and Blockchain apart. However, only a small fraction of the community can distinguish the differences between them. Therefore, this article will take a look at both terms, and explore the similarities and differences between them.
What is Blockchain?
People in cryptocurrency industry compared blockchain to the ‘engine room’. It is a distributed or ledger technology that can store data or records between multiple parties. Blockchain is fundamentally a form of database, though most users would use it to store transaction records due to its secure and immutable nature. The transactions entered into the ledger are visible to all the computers or nodes that make up the blockchain network. With Blockchain, people can pool resources together to form a network and share valuable data, all without compromising the integrity and security of the shared data or resources. Due to its immutable characteristic, no one can alter information stored on the blockchain. Thus, blockchain insures protection as well as security of stored information.
Several technologies, including cryptocurrency, are build on blockchain technology. Distributed ledgers and smart contracts are two of the most versatile and multi-purpose blockchain-based technologies. The two technologies have had a huge Positive impact in nearly all sectors, from insurance to healthcare,real estate to banking, and a multitude of others.
What is Bitcoin?
Bitcoin is the first digital currency which built on Blockchain technology. A group of anonymous people, or perhaps just a single person, commonly referred to as Satoshi Nakamato invented Bitcoin. The purpose to create Digital currency was to circumvent . Conventional payment systems, and to spare users of the numerous challenges they have to contend with when transacting through the regular banking system. For instance, while banks and its intermediaries may take days to perform overseas remittance, Bitcoin can do so in ten minutes. The ease and efficiency that the digital currency has bestowed promises to change how we conduct business and transactions on a global scale.
As the first, and perhaps the most popular cryptocurrency, Bitcoin has a wide range of applications. Aside from its everyday use as a mode of payment, it is also one of the most liquid cryptocurrencies, with the largest market capitalization that runs upwards of billions of dollars. Currently, a Bitcoin (BTC) sells for over $16,000 in the cryptocurrency market. Usually it has a good store value so people termed it as “digital gold”. Fiat currencies issued by the government and hence, are controlled by the government only. Bitcoin is a decentralized cryptocurrency and is not under the control of any central authorities. This is aside from the lower transaction fees it attracts, unlike transactions through fiat currencies that attract huge fees.
The connection between the two is probably one of the reasons why people who are new to the cryptocurrency community mix these terms up and use them interchangeably, albeit erroneously. Notably, they are two distinct terms with different meanings and areas of application.
The differences between Bitcoin and Blockchain:
1.Blockchain is a revolutionary technology. We need blockchain to build Bitcoin and other digital currency.
2. Bitcoin is a cryptocurrency that is usable as a means of exchange or store of value. While Blockchain is not a digital currency but a technology on which digital currencies are built.
3. While Bitcoin is restricted to serving as a means of exchange and trading, Blockchain has multiple uses. Through smart contracts, the Blockchain technology car be adopted in practically all global market sectors to alte their conventional mode of operation.
4. Bitcoin is a public domain, while there are public and private blockchains that operate under different rules.
5. An interesting fact is that the underlying principle behind Bitcoin is anonymity while on the other hand, blockchain promotes transparency. Bitcoin transfers currency between users, while blockchain has many different purposes, including the storage of information or property ownership rights.
We hope that this article sheds more light on the differences between Blockchain and Bitcoin, and that it aids you in your journey into the cryptocurrency industry.
