In this article, we’ll be looking at these two cryptocurrencies and exploring their differences as well as their similarities. While their original functions vary significantly, both these cryptocurrencies have consistently been fixtures in the top 20 cryptocurrencies by market cap. It’s worth noting that both these cryptocurrencies were designed to complement Bitcoin, but have both forged their own niche markets in the process.
As we look into Litecoin vs Ethereum, we’ll explore their fundamental differences when it comes to technology, use cases, value and influence. If you’re new to the market, this will also provide valuable insight into learning about the subtle differences between cryptocurrencies.
Where Did They Come From?
Known as digital silver to Bitcoin’s digital gold, Litecoin (LTC) was created in late 2011 after implementing a hard fork off of the Bitcoin blockchain. A former Google engineer and MIT graduate spearheaded the development team, with the intention of making Litecoin an alternative digital currency to Bitcoin that is able to execute transactions more quickly.
The team implemented several changes, including making the time it takes to confirm a transaction four times faster and making the total supply four times larger than Bitcoin. With lower transaction fees and speedier executions, Litecoin built up an impressive $1 billion market cap in the first two years after launching.
Ethereum (ETH) on the other hand was first introduced to the world in 2013 by project head, Vitalik Buterin. After a successful crowdfunding round the project was officially launched in 2015 to wide excitement. While Bitcoin was created to be a store of value and medium of exchange, Ethereum was created to provide developers with the means to create their own blockchain networks on top of the Ethereum blockchain.
Designed as a blockchain operating system of sports, developers are able to create dapps (decentralized applications) and smart contracts using the open-source coding nature of the platform. Ethereum also provides several token standards allowing developers to create their own tokens (aka cryptocurrencies).
Where Are They Now?
Currently trading at number 17 on the list of top cryptocurrencies, the project has a market cap of $11.6 billion. In the past 24 hours, $2.7 billion worth of LTC has been traded, giving an indication of the use of the network. Also at the time of writing the cryptocurrency is trading at just below $200. Of the platform’s 84 million max supply of coins, 82% are in circulation, allowing a further 116.3 million to be minted in coming years.
Ethereum is currently ranked as it has been for a while, at number two on the list of top cryptocurrencies. While the platform has created the foundations for several industries, namely the DeFi (decentralized finance) movement, through this it has experienced and overcome many ups and downs.
The platform currently has a market cap of $406 billion, with 1 ETH trading at roughly $3,500. Unlike Bitcoin and Litecoin, Ethereum does not have a maximum supply and currently has over 117 million ETH in circulation. At the time of writing Ethereum holds 18.5% market dominance.
Ethereum is currently undergoing an upgrade which will see the network going from a Proof-of-Work consensus to a more energy-sustainable Proof-of-Stake consensus mechanism. ETH 2.0 is expected to launch in early 2022 as the final upgrades are implemented.
How Do They Differ?
Highlighting their similarities and differences in this look into Litecoin vs Ethereum, let’s explore several defining characteristics.
Both projects make use of blockchain technology, however, their mining algorithms differ significantly. Litecoin uses the Scrypt algorithm in its PoW mining (different to Bitcoin’s SHA-265) which consumes less electricity and is able to handle more transactions at any given time. The technology was designed to provide a crypto alternative to the likes of PayPal and Visa.
Ethereum on the other hand currently uses an Ethash algorithm in its PoW mechanism but is in the process of moving to a Proof-of-Stake model. While the PoS concept works slightly differently in that it awards the mining process to miners holding the most ETH, it is also considered to be more environmentally friendly in terms of its electricity consumption.
While neither of these cryptocurrencies was designed to be a store of value in their initial inception, both have seen considerable gains when it comes to return on investments. According to Coin Market Cap, Ethereum has experienced ROIs in excess of 120,000% while Litecoin is sitting at 3,800%.
Primary Use Cases
As mentioned above Litecoin’s primary use case is that of a medium of exchange. The platform is designed to be able to handle a considerably larger amount of transactions at a faster rate than that of its predecessor (Bitcoin). While Litecoin is yet to experience the widespread adoption rates of Bitcoin, the cryptocurrency has the potential to become a more valuable (in terms of functionality) digital currency in the space.
Ethereum on the other hand is designed to provide a platform on which developers can build dapps. While there are other platforms providing a similar service, none of them has experienced the same success. According to State Of The Dapps, Ethereum currently has over 2,800 dapps on the network, compared to next in line, EOS which has 340 and TRON which has over 80. Covering a plethora of industries, finance, exchanges and security are the sectors where Ethereum’s dapps are most widely used.
Litecoin vs Ethereum
In the battle of “is Litecoin better than Ethereum,” we’ve learnt that they’re significantly different in everything from their core concepts to the way they are used. While each one is valuable in its own right, comparing the two is comparing apples and oranges.
If you’d like to learn more about either of these two cryptocurrencies, head to our Oobit blog where tons of insightful content awaits you. On the other hand, if you’d like to buy these cryptocurrencies, you can do so in minutes using the Oobit platform. Quick, easy and secure, Oobit delivers a seamless crypto onboarding service.
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