Cardano vs Ethereum: Which Crypto Is Best for Beginners?
It’s difficult to know where to start as a crypto beginner when there are so many cryptocurrency options to choose from. After Bitcoin, two popular choices are Ethereum and Cardano. They are both known for being “smart contract” platforms that can run many exciting new blockchain applications. But, which one is better? Which has a more promising future? And which one will earn you more money?
Here’s an explanation for beginners wanting to exchange crypto online and deciding where to start.
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Let’s Get to Know Ethereum Better
Ethereum is the second most popular blockchain network and the most popular smart contract platform in the world. It has become the favored platform for building decentralized applications (dApps), decentralized finance apps (DeFi), and non-fungible tokens (NFTs).
These applications are underpinned by Ethereum’s smart contract platform. ETH tokens can be used in decentralized applications and to run smart contracts on Ethereum. This means ETH tokens have real utility, unlike Bitcoin tokens which can only be traded. These applications create demand for ETH and keep the price strong.
ETH Profits
For early investors, Ethereum has been insanely profitable. During the ICO, ETH tokens sold for approximately $0.30. Since then, they have soared to many thousands of dollars in value.
Soon, Ethereum will transition to a Proof-of-Stake network, meaning it will be possible to earn ETH tokens by simply holding them and participating in the network (known as staking).
Ethereum Controversial Points
Ethereum is considered a second-generation blockchain platform (after Bitcoin, the first-generation platform). It has many advantages over Bitcoin, but still has issues. The main ones relate to scalability and sustainability.
Ethereum currency uses a proof-of-work system that seems outdated to many, requiring huge amounts of energy to run and tending to concentrate control of the network with large mining pools. Scalability is also a problem with Ethereum, with transactions severely limited and expensive compared with other, newer blockchains, such as Cardano.
What Do We Know About Cardano?
Cardano is also a smart contract platform just like Ethereum. It was even developed by one of the founders of Ethereum, Charles Hoskinson. Cardano is built on slightly newer technology than Ethereum and is considered a third-generation blockchain platform. Its main advantages are that it’s more scalable, more sustainable with its proof-of-stake algorithm, and developed with a culture of evidence-based peer-review. Cardano’s native cryptocurrency token is named ADA.
Cardano doesn’t have anywhere near the adoption levels of Ethereum. But, it is still in the top 10 cryptocurrencies by market capitalization. However, the Cardano team and community intend to use the network’s technological advantages to overtake Ethereum in the future.
ADA Benefits
The main benefit of ADA tokens for investors is the ability to delegate tokens to earn crypto rewards. It’s possible to earn up to 4-5% interest delegating ADA tokens.
Another benefit of ADA over ETH is there is a fixed supply of ADA, while new ETH tokens are created every year. This means the future supply of ADA is much lower than ETH, which will help keep the price high in the future.
Cardano Limitations
The core limitation of Cardano is that it is in a much earlier stage of development than Ethereum. Fewer people use the network, fewer exchanges have the token available, it currently has less momentum, and it is at a higher risk of failing in the short to medium term due to smaller adoption. However, if you’re a believer in the technology and the development team, these could all possibly be overcome.
Cardano and Ethereum Price Comparison
When comparing Cardano vs Ethereum, it’s easy to see they both have very strong positions (top 10) in the market today — both in terms of total market valuation and total trading volume. However, the main difference is that ETH is currently stronger than ADA, with more than 10x the total market value of coins, and 20x the daily trading volume. These numbers are subject to change a lot with the volatile crypto markets.
Newbie Choice: What Crypto to Start With?
These networks have a common founder and many similar features. However, Ethereum is still a much safer bet until Cardano can prove itself with wider adoption of its network and currency. This also means that Cardano has more room in the long term than Ethereum. So, don’t dismiss Cardano outright — it’s one of the most promising blockchain networks on the market.
