In this article, we’re going to be comparing two popular cryptocurrencies. We’ll look at them in detail and examine why they were created. We’ll also explore their history, block size, market cap, and daily transactions. Finally, we’ll look at their plans and their differences and similarities.
History
The history of a cryptocurrency is an essential factor to consider when looking at its viability as a potential investment. In short, looking at where it has come from will give you a good idea of where it’s heading.
Ethereum (ETH)
Ethereum’s whitepaper was released in 2013 by programmer Vitalk Buterin. In 2014, development and crowdfunding began, and the network was finally fully released to the public in 2015.
The Ethereum network lets anyone host decentralized applications on it. It also allows users to exchange NFTs. Ethereum is even the host of peer-to-peer lending platforms.
In September 2022, Ethereum transitioned from using a proof-of-work to a proof-of-stake consensus mechanism to verify transactions. This transition was called “the Merge.” This transition was called “the Merge.” The proof of stake (PoS) consensus mechanism has a faster transaction speed. It also consumes less energy to achieve consensus.
Avalanche (AVAX)
Avalanche is much newer than Ethereum, have been released in September 2020. It was co-founded by three people: Ted Yin, Emin Gün Sirer, and Kevin Sekniqi, under the company Ava Labs.
What Are They, And Why Were They Created?
So what are Ethereum and Avalanche, and why were they made? We’re going to explore these questions next:
Ethereum (ETH)
This platform chain introduced the concept of smart contracts and has remained a strong force in the market, 2nd only to Bitcoin. Ethereum has one of the most diverse DeFi ecosystems in the world. EIt has served an important role in displaying how decentralized networks can improve centralized ones.
Avalanche (AVAX)
How does Avalanche work? Ava Labs released this DeFi-enabled protocol with a multi-chain approach, improving programmability and lessening fees. Avalanche reduces a lot of the problems that Ethereum developers may experience. Its primary benefit, however, is that it boasts much better scalability than Ethereum.
Avalanche even has features that are made to help onboard Ethereum developers.
Price History
The price history of a cryptocurrency is an essential factor to consider when contemplating what to invest in. In the next few paragraphs, we’re going to explore the ups and downs of Ethereum and Avalanche:
Ethereum (ETH)
In 2015, Ethereum was valued at just a few dollars and less than a dollar at its lowest. 2016 wouldn’t be much different. However, in 2017, Ethereum spiked to a couple of hundred dollars and peaked in 2018 at over $1,000.
This was followed by a decline in 2018, staying within the hundreds of dollars of the bull market in 2021. A bull market occurs when investor activity peaks and there’s a generally positive attitude about investing. Significant increases in the value of a cryptocurrency mark these periods.
In 2021, Ethereum would find itself peaking above $3,000 and $4,0000 respectively. It then decreased over time, settling to where it is now at $1,271.36.
Avalanche (AVAX)
Since joining the market, Avalanche’s price has been relatively consistent, being valued within the tens of dollars range. This is except for during the 2021 bull market peaks, when it was valued over $100.
At the time of writing this, AVAX is valued at $13.21.
Market Cap
The market cap is the value of every coin that’s been mined. But what kind of market cap do these two cryptocurrencies boast? Let’s explore this in the next section.
Ethereum (ETH)
Right now, Ethereum boasts a market cap of $150,535,357,048. This places it comfortably in rank 2 of the world’s cryptocurrencies.
Avalanche (AVAX)
Avalanche boasts a market cap of $4,112,546,400, putting it at rank 18 of the world’s cryptocurrencies.
Daily Transactions
Another critical variable to consider is the number of daily transactions a cryptocurrency does in a day. This may also be known as the 24-hour volume.
Ethereum (ETH)
Ethereum’s current latest 24-hour volume is $6,131,095,744.
Avalanche (AVAX)
The Avalanche ecosystem, at this moment, has a 24-hour volume of $150,680,230.
Block Size
The block size of crypto is the amount of data a single block can hold. Larger block sizes allow for higher transaction-per-second rates. The downside is that they may result in chain splits and stales.
Ethereum (ETH)
Ethereum’s typical block size used to be around 80 KB. However, now, it’s at a limit of 1 MB.
Avalanche (AVAX)
Like Ethereum, Avalanche has a block size limit of 1 MB.
Similarities
Do these separate blockchain networks have any similarities? Well, we already know that they share the same block size. However, did you know that both Ethereum and AVAX use the proof-of-stake method to verify their transactions? They’re also both the primary utility tokens on their respective networks.
Additionally, they both use smart contracts that support different blockchain projections. And they’re nearly equally able to process high numbers of transactions each second; however, Avalanche is a bit faster. However, while ETH was still on the proof-of-work consensus mechanism, this was far from the car, and AVAX was far superior.
Finally, the transaction fees for Ethereum vary drastically depending on the blockchain you use, just like Avalanche’s native token gas fees may also vary.
Differences
Despite Ethereum’s popularity, Avalanche remains the cheaper and faster option. It was designed to fill a gap, particularly in light of Ethereum’s success.
Risks
There are risks associated with investing in any cryptocurrency. They’re notoriously volatile, lie on shaky ground regarding regulation, and are generally controversial. Warren Buffet even publicly criticizes crypto for not producing anything tangible.
Ethereum (ETH)
Ethereum, the world’s second highest-ranked cryptocurrency, will probably become subject to regulation. This would hinder its current growth as a decentralized network. The UK is already putting steps in place to regulate crypto, while India has set a 30% capital gains tax on gains made from crypto. China has outright banned all cryptocurrency transactions.
A second issue is that Ethereum has a lot of competition. The Avalanche network, for example, is an entirely viable alternative to Ethereum and has many benefits. Various other emerging smart contract platforms, such as Polkadot and Smart Chain, add pressure to this problem.
Avalanche (AVAX)
As with other cryptocurrencies, there’s a lot of uncertainty regarding investing. Investing in cryptocurrency is a high-risk investment, and AVAX is no exception. There’s no guarantee that the crypto will increase in price in the future. You may have to endure extended periods where the price continually plummets.
Where to Buy
So, where can you buy these two cryptocurrencies? Let’s explore this next.
Ethereum (ETH)
Ethereum can be purchased on various crypto exchanges, including Kraken, Binance, Gemini, and Coinbase. Comparing different platforms is essential in determining where you’ll ultimately purchase from.
Make sure to do a thorough analysis before investing, as many fake websites exist that lie about selling you crypto. Check the website’s security, whether the provider has a license, and where the headquarters is.
Avalanche (AVAX)
AVAX can be traded on many exchanges, including Kraken, Crypto.com, and Coinbase. It’s also available on many other smaller exchanges. Like with Ethereum, take time to compare your options before investing.
Exchanging Ethereum (ETH) for Avalanche (AVAX)
You can exchange Ethereum for Avalanche on various cryptocurrency exchanges. LetsExchange, for example, lets you convert your ETH to AVAX by running through a few steps.
First, select the coin you wish to exchange and how much. Then you must choose the crypto you wish to purchase. Next, you should provide your wallet address and send the coins needed for the swap.
Most exchanges should follow a similar process to this.
Future Plans
What does the future look like for Ethereum and Avalanche? Let’s take a lot at this in some detail.
Ethereum (ETH)
The Ethereum blockchain has a future that depends on many variables. These include new competitors, the growing popularity of current competitors, and government regulation.
But regardless, some predictors can give Ethereum users an idea of what it’ll look like. And one such predictor is its developer’s plans for sharding. Sharding is when a database is split to spread the load.
Sharding will encourage more users to participate in Ethereum’s networks by allowing people to run Ethereum on a smartphone. In addition, the increased decentralization ensures that the network is less vulnerable to attacks.
Scaling generally provides the opportunity to scale up and doesn’t increase the size of pre-existing databases. It will be exciting to see what happens when this development takes place in 2023.
What about its future price? Well, some price predictions put Ethereum at nearly $10,000 by 2030. However, estimates will almost always vary.
Avalanche (AVAX)
Avalanche users have a positive view of AVAX’s future for a good reason. This network is superior in many ways to Ethereum. Therefore, Avalanche’s developers will be hard at work maintaining and improving the system.
As for its future value, some predictions put Avalanche’s price at a couple of hundred dollars by 2030, while more conservative estimates put it at about $162.
Only time will tell.
Sources:
https://www.securities.io/avalanche-avax-vs-ethereum-eth-everything-you-need-to-know/
https://www.fxcm.com/markets/insights/ethereum-vs-avalanche/
https://www.coindesk.com/learn/what-is-avalanche-a-look-at-the-popular-ethereum-killer-blockchain/
https://cointelegraph.com/ethereum-for-beginners/history-of-eth-the-rise-of-the-ethereum-blockchain
https://changelly.com/blog/ethereum-eth-price-predictions/
https://www.cryptonewsz.com/forecast/avalanche-price-prediction/
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