How do Bitcoin and Ethereum differ in purpose?

Bitcoin was designed primarily as a decentralized store of value and payment network; Ethereum added a general-purpose programmable layer that can run arbitrary smart contracts.

Bitcoin came first, treating its blockchain mainly as a way to make peer-to-peer transactions and hold a scarce "digital gold." Its developers kept its scripting intentionally limited (Turing-incomplete) — Bitcoin can express simple contract-like conditions, but not full programs, by design, because they viewed it as a store of value. Ethereum, proposed by Vitalik Buterin and launched in 2015, reused the same blockchain foundations but added one transformative feature: the ability to run arbitrary code on-chain. That turned the blockchain from a ledger of balances into a decentralized computer, enabling not just payments but decentralized agreements, organizations, and applications. In short: Bitcoin optimizes for sound money; Ethereum generalizes the blockchain into a programmable smart-contract platform. Both remain valuable even without contracts, because a censorship-resistant store of value is powerful in its own right.

Go deeper:

• Bitcoin — Wikipedia — the store-of-value network with deliberately limited scripting.
• Ethereum — Wikipedia — the programmable, smart-contract-capable platform built on the same foundations.