Bitcoin Blockchain
The Bitcoin blockchain is sometimes called the first generation blockchain because it was effectively the first-ever iteration of blockchain technology. This blockchain is essentially a decentralized peer-to-peer electronic transaction system, meaning individuals can transact directly with each other over the blockchain with no middle man.
Bitcoin uses a specific verification method, more commonly known as a consensus algorithm, called ‘Proof of Work’ (PoW). The way PoW works is the network puts out a code that needs to be solved, and verifiers, commonly known as miners, compete to find that code, which is programmed to happen every 10 minutes. Whoever solves the code verifies that new block on the chain, and gets a Reward in Bitcoin.
Ethereum Blockchain
The Ethereum blockchain is a bit more complex. Ethereum was the first blockchain to introduce smart contracts, which are contracts that self-execute when the specified criteria is met. Ethereum also uses decentralized applications – commonly referred to as dApps – which are the mechanisms that execute the actions specified by the smart contracts. Each dApp performs a specific function on the accord of the smart contracts.
Unlike Bitcoin, Ethereum is migrating toward a consensus algorithm called Proof of
Stake (PoS). Some in the Bitcoin cult may literally refer to this as POS. The PoW model uses a lot of energy, so PoS was created as a way to reduce energy usage thus making the network more sustainable. The way a PoS blockchain works is through people who own that cryptocurrency staking their coins to get access to verify transactions as opposed to competing to solve a code. On the Ethereum blockchain blocks get verified roughly every 10 to 20 seconds making it faster than Bitcoin. However, its network fees are much higher due to its consensus model, lack of scalability, and the high number of people now using it.