What is Bitcoin
Bitcoin(BTC) is the first virtual currency in the world and traces back to the year 2009, and is believed to be created by the (still unknown) pseudonym of Satoshi Nakamoto. It was designed to reduce transaction fees for online payments, increase security by using encryption and to create a decentralized inflation free currency. Bitcoin is fueled by the blockchain technology, that is built on a peer-to-peer network. Transactions that are made have to be approved by the public ledger before they can be made (this on order to prevent re-using bitcoins)and will take approximately a couple of minutes to complete. Bitcoin has grown to the most popular virtual currency in the world and is accepted at numerous online webshops (like Ebay.com and Justeat.nl) and its marketcap is still rising, today (22-10-2016) a Bitcoin is sold for approximately 590 Euros per coin.
What is Ethereum
Ethereum(ETH) is launched in 2015 and is the largest open-ended decentralized software. It provides application building (+ all kinds of extra possibilities), is a programming language and is also a virtual currency. And where the virtual currency started as an internal currency within the Ethereum platform it has grown exponentially for the last year and has surpassed Litecoin and Ripple (known for the Bitcoin-bridge) in market capitalization. The technology behind the currency is based on blockchain technology but is supporting more than only the currency itself, and is referred to as blockchain 2.0. the difference in speed compared to bitcoin transactions is high; a Ether transaction can be completed in seconds. One ETH is sold today for approximately 11 Euros.
Is Ethereum surpassing Bitcoin?
Both currencies are powered by blockchain technology and both have a high market capitalization (although the market share of Bitcoin is still a lot larger than that of Ethereum). There are lot of differences in technology like programming language (BTC= stack based, ETH= own language), basic builds and implementation of blockchain technology. But the real difference is in the purpose it is designed, Bitcoin is clearly designed to be a currency that tries to become a established virtual currency in the world. While Ethereum is designed to also be a platform that facilitates peer-to-peer contracts and applications, and the primary goal is not to become a payment alternative.
So?
In sum you can say that BTC and ETH can be even complements in some ways, and do not directly compete with each other over the virtual currency market. Although ETH is a rising star with an corresponding growing market share, and in these rapidly changing times it is not certain that ETH doesn’t change its overall prupose and targets the very lucrative market for alternative payments.
Sources
Bitcoin.it
Investopedia.com 
I think Ethereum definitely has the makings of something great. I have heard stories emerging of Ethereum fulfilling the role of a decentralised internet. As a peer to peer system it would allow users take back control of their data. This is particularly interesting given the importance of information. In another instance, it was even mentioned that Ethereum has the potential to completely manage the workings of a company board. It uses smart contracts that allow certain rules to be programmed into it. This would essentially mean that firms would be able to be run with minimal human intervention. While these are just a few of Ethereum’s potential developments, it does go to show how it is gaining traction in block chain 2.0. I think that if Ethereum does decide to hone in on alternative payments, it would have the capacity to surpass Bitcoin.
Dear Bram,
Interesting article, I was not aware of Ethereum but it looks like a valid competitor to bitcoin. However, what I am worried about is that for a cryptocurrency to work on a global scale and remove currency frictions, one single currency needs to capture the entire market space. Especially with the introduction of other currencies, such as the Gulden Coin for example, there are multiple alternatives. So in that case, Ethereum’s platform functionality allows it to have functionality even if bitcoin becomes the digital payment standard. To me that platform functionality is what makes Ethereum interesting and what can make it become a cornerstone of digital transactions.