Bitcoin vs. Ethereum: Which Is More Likely to Be a Millionaire Maker?

Over the past decade, investing in hypergrowth cryptocurrencies has become a proven way to attain millionaire status. According to the latest Crypto Wealth Report from Henley & Partners, there are an estimated 241,700 crypto millionaires in the world right now.

Of these, 145,100 are Bitcoin (CRYPTO: BTC) millionaires. But is Bitcoin still the most likely way to grow your wealth over time? Or could Ethereum (CRYPTO: ETH) potentially offer a faster path to millionaire status? Let's take a closer look.

Historical track records

The key to Bitcoin's enormous success has been its ability to compound its performance, year after year, with just a few missteps along the way. Since 2010, Bitcoin has only had three losing years: 2014, 2018, and 2022. In every other year, it has ripped higher at a head-spinning rate.

More than any other cryptocurrency, Bitcoin demonstrates the power of compounding returns. In the period from 2017 to 2025, Bitcoin grew at a compound annual growth rate (CAGR) of 50%. That's all the more impressive given that it collapsed in value in both 2018 and 2022. But the other years were so phenomenal that they more than made up for the bad years.

In fact, it's getting to the point where investors think Bitcoin can double in value every year. At the start of this year, for example, the conventional wisdom was that Bitcoin would double in value, from $100,000 to $200,000. That hasn't been the case, of course, but Bitcoin did hit a new all-time high of $126,000 in October.

Ethereum has been no slouch, either. During that same time period, Ethereum grew at a CAGR of 33%. Ethereum, too, tends to follow a four-year cycle, in which three good years are followed by one absolutely miserable year. After growing by 472% in 2020 and 395% in 2021, for example, Ethereum promptly gave it all back. In 2022, Ethereum lost 68% of its value.

Future growth projections

Another way to evaluate the millionaire-maker potential of any cryptocurrency is by taking into account future growth projections. In most cases, these are built by evaluating the potential use cases of a cryptocurrency, and then estimating how much market share it might gain within a certain niche, vertical, or industry.

Image source: Getty Images.

Here, too, Bitcoin appears to have the edge over Ethereum. The conventional wisdom is that Bitcoin can hit a price target of $1 million within the next five years, based on an exploding set of new use cases. That point of view has been supported by Cathie Wood of Ark Invest, Brian Armstrong of Coinbase Global, and Jack Dorsey of Block.

Growing tenfold in price within a short period of time might seem impossible. But, time and time again, Bitcoin has grown at an exponential rate. It soared from $1 to $10, then $10 to $100, then $100 to $1,000, then $1,000 to $10,000, and then $10,000 to $100,000. All of that took place in the span of less than 15 years. So why can't Bitcoin once again grow from $100,000 to $1 million?

Ethereum, too, has been the subject of endless speculation about how much higher it might go. At one time, investors thought Ethereum might even surpass Bitcoin in market cap, due to how fast it was growing.

Right now, one of the most aggressive future price targets for Ethereum is $20,000. Given Ethereum's current price of $3,150, that implies a nearly sixfold increase in price. That's highly impressive, of course, but it falls short of Bitcoin's potential tenfold price increase.

What happens to growth rates over time?

Based on the above, Bitcoin would appear to be the obvious winner. You really can't argue with a cryptocurrency that has already minted 145,100 millionaires. Yes, Bitcoin can experience tremendous volatility. But in eight of the past 10 years, it has been the top-performing asset in the world.

Of course, I fully expect the growth rates of both Bitcoin and Ethereum to slow over time. If Bitcoin is indeed "digital gold," as many crypto investors claim, shouldn't its performance more closely track the long-term performance of gold? That might give an opening to Ethereum, which more closely resembles a tech stock than a commodity. And, over time, wouldn't you expect tech stocks to outperform gold?

That being said, I can't think of a better long-term investment than Bitcoin. As long as you're prepared to deal with the inherent volatility of crypto, a patient approach should ultimately pay off. There's no guarantee you'll become a millionaire by investing in Bitcoin, but there are 145,100 people around the world who will tell you that your odds are going to increase markedly if you do.

Dominic Basulto has positions in Bitcoin and Ethereum. The Motley Fool has positions in and recommends Bitcoin, Block, and Ethereum. The Motley Fool recommends Coinbase Global. The Motley Fool has a disclosure policy.