Posted: 01.07.2021 | 10:37
What are the differences between Bitcoin and Litecoin?
BITCOIN VS LITECOIN
The identity of Bitcoin creator Satoshi Nakamoto is unknown, while Litecoin creator Charlie Lee is widely known. Litecoin was issued in 2011 to become “silver” over Bitcoin’s “gold”.
LITECOIN VS. BITCOIN
|First Developed||Satoshi Nakamoto||Charlie Lee|
|21 million||84 million|
Halftime Block Reward
|Every 210,000 block||Every 840,000 block|
Average Transaction Time
|10 min.||2.5 min.|
SIMILARITY BETWEEN BITCOIN AND LITECOIN
Bitcoin and Litecoin have a lot in common. Both are decentralized cryptocurrencies. Litecoin was launched in 2011 by its founder, Charlie Lee, who announced the debut of a “lite version of Bitcoin” in a post on a popular Bitcoin forum. From its inception, Litecoin was seen as being created in response to Bitcoin.
Storage and Transactions
For an investor, many of the key elements of trading with Bitcoin and LTC are similar. Both of these cryptocurrencies can be bought via the exchange or mined using a mining rig. Both require a digital or cold storage “wallet” for secure storage between transactions. It has also been proven that both cryptocurrencies are subject to some fluctuations over time based on factors related to investor interest, government regulation, and more.
DIFFERENCES BETWEEN BITCOIN AND LITECOIN
One area where Bitcoin and Litecoin differ significantly is market cap. As of May 2020, the combined value of all Bitcoins in circulation is just under $128 billion, making its market cap 45 times greater than Litecoin with a total valuation of just under $3 billion. Bitcoin's market cap, high or low, depends heavily on a historical perspective.
The main difference between Litecoin and Bitcoin is the processing time. Compared to Bitcoin's 10-minute average, Litecoin can be transacted in 2.5 minutes. This means Litecoin is 4 times faster than Bitcoin. While Litecoin is of interest to merchants to be faster, Bitcoin is more common as it is considered a better store of value. Another difference is that while Litecoin mining can be done on a home computer today, more specialized computers are required for Bitcoin.
Another important difference between Litecoin and Blockchain is due to the mining algorithm. While both work with the Proof of Work mechanism, Bitcoin uses the classic SHA-256 hash algorithm. Litecoin, on the other hand, uses a relatively newer algorithm called Scrypt. Scrypt uses less computational (computer) power.
Coin Limit and Block Rewards
In the mining process of both Bitcoin and Litecoin, miners receive rewards for creating blocks and confirming transactions. But both have a supply limit. Bitcoin has a block limit of 21 million, while Litecoin has a limit of 84 million blocks. Once these limits are reached, new coins will not be created. These rewards are halved due to their limitations in supply numbers. While Bitcoin will halve the rewards every 210k block production, Litecoin will halve every 840k block production.