Tezos vs Bitcoin
A quick comparison (last updated 5th, Feb 2024)
Tezos block time is 15 seconds
Transactions on Tezos are final after two blocks (30 seconds). The transaction is final and irreversible, providing certainty.
Tezos can do 8,200 transactions per second at Layer 1
The fees go up when the limit is reached
The average fee at time of this writing (5th Feb 2024) according to tzflow.com is $0.001 USD / transaction
Tezos has ~400 governing nodes
The top 5 Tezos bakers by stake control 35.23% of the network. This can be verified on a Tezos blockchain explorer like TzKt.
Tezos has a formal governance structure
Tezos has a formal governance process where stakeholders can vote on protocol upgrades and changes, enabling the network to evolve and adapt over time without forking.
Tezos has staking rewards
Tezos offers staking rewards to users who participate in the network's proof-of-stake consensus mechanism by "baking" or "delegating" their tokens, incentivizing network participation and security.
Tezos has smart contracts
Tezos: Supports smart contracts, enabling developers to create decentralised applications (dApps) and execute complex financial transactions on the blockchain.
Tezos has enshrined rollups
Rollups on Tezos are integrated into the core protocol, which means that the blockchain's design has built-in mechanisms for executing layer 2 solutions like rollups. This integration can facilitate seamless scalability improvements and helps maintain a more decentralised approach by using the protocol itself rather than external systems.
Bitcoin has slower and probabilistic finality
Transactions on Bitcoin never considered absolutely final due to the nature of its consensus mechanism, which is probabilistic. This means that while it is unlikely for a transaction to be reversed once it's been included in a block and several confirmations have occurred, it's not technically impossible.
Bitcoin can do 7 transactions per second at Layer 1
The fees go up when the limit is reached
The average fee at time of this writing (5th Feb 2024) according to ycharts.com is $12.56 USD / transaction
Bitcoin has ~72 mining pools
The top 5 Bitcoin mining pools by hashrate control 86.83% of the network. This can be verified on a Bitcoin blockchain explorer like blockchain.com
Bitcoin lacks a formal on-chain governance mechanism
This leads to decisions made through community consensus and implemented via "soft forks" or "hard forks," which can and has resulted in splitting the network and community.
Bitcoin does not have staking rewards
Bitcoin does not offer staking rewards as it operates on a proof-of-work consensus mechanism, where miners receive rewards for mining new blocks but regular users do not earn rewards for holding coins.
Bitcoin does not have smart contracts
Bitcoin was not designed with smart contracts in mind, and while there is some level of scripting possible, it's not as robust or flexible as Tezos's smart contract capabilities
Bitcoin has lightning
The Lightning Network operates as a separate layer on top of Bitcoin's main blockchain. While it significantly increases transaction speed and reduces costs, it introduces a few centralization concerns:
To use the Lightning Network, users must open payment channels with sufficient liquidity. Over time, this can lead to a network where the most connected and liquid nodes become central hubs, potentially leading to a degree of centralisation, as these hubs facilitate a large volume of transactions.
Layer 1 Interaction: Interaction with Bitcoin's layer 1 is necessary to open and close channels on the Lightning Network. This means that users still have to conduct on-chain transactions, which can be costly and slow, somewhat negating the benefits of the Lightning Network if the main chain is congested.
Operational Complexity: The requirement to manage channels and liquidity can be technically challenging for average users, potentially leading to reliance on more centralised services that simplify the process but also control user funds.
To find out how to bake tezos, visit tezos.rocks