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What Is The Difference Between Bitcoin And Cryptocurrency?

Author: Jeffrey Craig Date: 2022-10-31 06:37:37

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Cryptocurrencies, blockchain, metaverse, and Web3 have risen to fame in under five years, successfully become popular mainstream terms and investment vehicles to achieving significant financial returns. However, in their rise is also a cloud of uncertainty about what exactly they are, what are the technologies being developed, and how are these terms being used in the real-world to create value.

Bitcoin vs Cryptocurrency

Bitcoin, in particular, is the king of crypto. But as more and more cryptocurrencies rise to the scene, Bitcoin has drifted away and taken up a mantle of its own, separating itself from the rest of the cryptocurrencies and becoming a super asset class in itself.

The best metaphor is what Gold is to commodities. Yes, Gold is a commodity, but it’s also talked about separately from the rest of earth’s hard metals and natural resources. This is what Bitcoin has become over the past five years since going mainstream in 2017. It’s a cryptocurrency, but it’s talked about, referenced, and invested in differently than the other cryptos.

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What Is The Difference Between Crypto And Bitcoin?

Cryptocurrencies have many definitions. For example, a cryptocurrency is a digital or virtual currency secured by cryptography, it’s a digital currency in which transactions are verified and maintained by a decentralized ledger system (blockchain) rather than a centralized authority (bank), and it’s a decentralized digital currency designed to be a medium of exchange.

Generally speaking, when talking about cryptocurrencies, they’re now commonly understood to be anything digital currency that’s not controlled by a bank or the traditional financial system. Therefore, any Web3 project and blockchain native cryptocurrency coin or token falls under the umbrella term “cryptocurrency.”

There are also thousands of cryptocurrencies, many of which the best ones are listed on Phemex, however, there’s only one Bitcoin.

So Is Bitcoin Cryptocurrency?

Yes. Bitcoin, too, also falls under the umbrella term cryptocurrency because it shares the same definition of a cryptocurrency, which is a decentralized digital currency that functions on the blockchain and that can be used peer-to-peer. So in this sense, Bitcoin is a cryptocurrency, and thus has no differences with the general term.

Is Crypto And Bitcoin The Same?

However, moving beyond the general broad definition, Bitcoin and crypto are not the same. This is because crypto is too broad of a term and Bitcoin is in fact a very specific cryptocurrency coin, which has its own purpose, developers, network, economics, and function.

For example, nowadays cryptos encompass stablecoins, governance tokens, Web3 infrastructure tokens, and specific marketplace currencies – but Bitcoin is none of these things and actually isn’t interoperable with many DeFi, NFT, and Web3 applications. Therefore, it differs greatly from other cryptos such as UniSwap, USDC, USDT, ETH, and MANA.

Now you’re starting to see the difference between cryptos and Bitcoin. So when it comes to purpose, design, and interoperability, Bitcoin is clearly separate from the vast majority of cryptos.

In particular, really only Bitcoin is seen now as the digital gold and as one of the only true cryptocurrencies in the peer-to-peer financial transaction sense. Other cryptocurrencies take on specific functions for DeFi, Ethereum-based applications, stablecoins, and for functioning in the metaverse. But none of these cryptocurrencies can do what Bitcoin can do, nor have they garnered the investor interest.

Bitcoin vs Cryptocurrency

CriteriaBitcoinCryptocurrency
FocusP2P TransactionsP2P Transactions, Remittances, DeFi, NFTs, Metaverse
SegmentCurrenciesCurrencies, Stablecoins, Web3, DeFi, Exchange Tokens
ConsensusProof-of-WorkProof-of-Work, Proof-of-Stake, Proof-of-History, many more.
NarrativeDigital GoldAny kind of decentralized currency that’s blockchain-supported
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