You’ve likely come across these two well-respected cryptocurrencies, but do you know the difference between them? In this piece we’re exploring the fundamentals of each digital currency, looking at where they came from and how they differ. In an epic battle over original and altcoin, find out who comes out on top in Litecoin vs Bitcoin.
In this article we're taking a comparative look at why Litecoin and Bitcoin were created and how they've performed to date. Also taking a look at their fundamental differences, we explore their capabilities and future potential.
Where Did They Come From?
Litecoin
Exploring the origin story of Litecoin, the altcoin was launched in 2011 by a former Google engineer and MIT graduate, Charlie Lee. Hard forked from the Bitcoin network, Litecoin was created to provide a “lite” version of the original cryptocurrency, particularly when it comes to transaction speed and cost.
Several changes to the Bitcoin code were implemented, including increasing the total supply and the hashing algorithm used in the mining process. In just two years after launching the cryptocurrency had built up an impressive $1 billion market cap.
Charlie Lee is still actively involved in the project, serving as the managing director of the Litecoin Foundation. Litecoin was never designed to replace Bitcoin, merely to compliment it, and has become known as “digital silver” to Bitcoin’s “digital gold”. The main concept behind the cryptocurrency was to provide a faster means of transacting digital money.
Bitcoin
Bitcoin on the other hand was launched in January 2009 by the anonymous entity using the name Satoshi Nakamoto. The cryptocurrency was the first of its kind, providing the world with a decentralized digital currency as well as “new and improved” blockchain technology.
The cryptocurrency was created as a response to the Global Financial Crisis that destroyed many people’s financial livelihood around the world. Nakamoto wanted to create a currency that was free from centralized control and could ultimately bank the unbanked.
Free from banks, financial institutions and governments, Bitcoin provided an electronic payment system that operated on a peer to peer basis. Since it launched over a decade ago, the industry has grown to have over 11,000 cryptocurrencies and a value of over $2 trillion.
LTC And BTC: Where Are They Now?
Litecoin
Usually a firm fixture in the top 10 cryptocurrencies based on market cap, Litecoin has moved into the top 20 in recent weeks. At the time of writing, the cryptocurrency has amassed an $10 billion market cap, with $3.2 billion worth of LTC traded in the last 24 hours, indicating a healthy use of the network.
LTC is currently trading at just over $150 and, of the maximum supply of 84 million coins, roughly 66.7 million are in circulation (79%).
Bitcoin
As the original cryptocurrency, Bitcoin still holds a strong market dominance attributing to 42% of the entire market’s value. The cryptocurrency has experienced unprecedented growth over the last year, and is currently trading just over $44,000.
The cryptocurrency hit its all-time high of $64,863.10 on 14 April 2021.
With 18.8 million BTC in circulation, that leaves 10% left to be minted (estimated to take place in 2140). While Bitcoin has seen fluctuating market patterns this year, the cryptocurrency remains a leader in terms of adoption, market dominance, and price.
The Difference Between LTC vs BTC
Despite Litecoin being built off of Bitcoin’s code, the cryptocurrencies differ in several distinctive ways. Below we explore the similarities and differences in this Litecoin vs Bitcoin debate.
Maximum Supply
While Bitcoin has a maximum supply of 21 million coins, Litecoin increased this amount by four times, creating a total of 84 million LTC available to be mined.
Mining
The mining process is relatively similar for both networks as they both utilize a proof of work consensus. Currently, mining a block on the Bitcoin network rewards the miners 6.25 BTC, while on the Litecoin network 12.5 LTC.
Both networks undergo halvings where this block reward is halved, taking place roughly every 4 years. However, on the Bitcoin network, this is implemented every 210,000 blocks while on the Litecoin network the mechanism is executed after 840,000 blocks are mined.
Hashing Algorithm
Litecoin opted to change the hashing algorithm of the Bitcoin network, moving from a SHA-256 hashing algorithm to one called Scrypt. Scrypt allows smaller miners to take part in the mining process and offers a lower hash rate.
Store Of Value
Bitcoin was created to provide both a store of value and a medium of exchange, while Litecoin was predominantly designed as a medium of exchange. Despite both networks being used for both causes, the return on investment differs substantially.
According to Coin Market Cap, Bitcoin has an ROI of 32,000% while Litecoin’s ROI sits at around 3,400% at the time of writing.
Transaction Speeds
On the Bitcoin network, it takes 10 minutes to create a new block, meaning roughly 10 minutes to execute a transaction. Working on the speed of the network, Litecoin decreased the block creation time to 2.5 minutes per block, allowing for much faster (and cheaper) transactions.
Litecoin vs Bitcoin
When it comes to comparing these networks, they’re really two different ball games. While Bitcoin is the original cryptocurrency providing an impressive return on investment, Litecoin provides a faster and cheaper means of transacting value around the globe.
As the world moves into a more digital space, Litecoin may well prove to be the digital currency of choice when it comes to a medium of exchange, while Bitcoin will always remain a firm favourite and excellent store of value.
Whichever cryptocurrency you choose to stand behind (no ones making you choose), Oobit provides a simple and transparent means of onboarding both digital assets. Through the easy to use interface you can purchase unlimited amounts of Bitcoin and Litecoin, and safely store them in your hyper-secure Oobit wallet. Create a free account on Oobit and get started today.
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