Bitcoin (BTC) and Litecoin (LTC) are two of the most recognized crypto in the world. While Bitcoin was launched by Satoshi Nakamoto in 2009, Litecoin was developed by Charles Lee in 2011.
BTC has an open code that was used by several other crypto projects. Litecoin is one such crypto. While the source code of both the digital currencies is the same, this is where the similarities end. Naturally, the BTC price is much greater, so much so that one bitcoin is currently worth 404.80 LTC.
Though Litecoin is known as the ‘silver’ to Bitcoin’s ‘gold’, there are some fundamental differences between the two currencies.
If you are wondering about the differences between Bitcoin and Litecoin, read on to know more:
A transaction is defined as the time that is taken for the block to be verified and added to the respective blockchain.
Though in both digital currencies, transactions happen instantaneously, Litecoin was created with the primary goal of increasing the speed of transactions. While Bitcoin transactions take approximately 10 minutes, Litecoin transactions get completed in 2.5 minutes. This makes the latter 4 times faster.
This makes Litecoin the preferred currency for conducting day-to-day transactions. On the other hand, Bitcoin is considered more as a store-of-value.
One of the major differences between the two currencies is how they use their proof-of-work algorithms. Bitcoin works on the SHA-256 algorithm and Litecoin uses the Scrypt algorithm. These two algorithms spell the difference between the speed at which both the coins are mined. Litecoin’s algorithm can produce coins 4 times faster and hence uses less computing and processing power. This algorithm is also less complex and customizable with different hardware solutions.
Bitcoin’s algorithm is known for being very complex. It also uses more processing power.
Both Bitcoin and Litecoin have a cap on their coin supply. While Bitcoin can produce 21 million coins, 84 million Litecoins can be created. While Litecoin may seem to have an advantage, both the coins can be divided and transferred in smaller amounts. However, given Litecoin’s higher bandwidth of coins and lower price, gives it an edge over Bitcoin. You can check prices of both coins and conversion rates like BTC to INR on Coinswitch.
Bitcoin and Litecoin also differ when it comes to their transaction fee. Users have to pay between $0.03-0.04 as the average transaction fees. Bitcoin is comparatively more expensive at approximately $7.60 as the average transaction fee. The reason for this difference in transaction fee is that the Litecoin network has set aside coins that aren’t derived from the transaction fees used to incentivize the coin miners.
Miners are rewarded for mining a block in cryptocurrency. Bitcoin currently offers block rewards of 25 BTC whereas LTC offers rewards at 50 LTC. Litecoin’s rewards are halved at every 84,000 blocks and Bitcoin’s rewards are halved at every 21,000 blocks. However, looking at how long it takes for both the coins to the processed, it takes years for the values of both the coins to be halved.
Bitcoin’s market capitalization stands at 721.81. This is higher than that of several Fortune-500 companies such as Citigroup, PepsiCo, Toyota, HSBC, etc. Bitcoin has single-handedly pushed the value of the entire crypto market. Litecoin, on the other hand, has a market capitalization of around 101.46. You can see the conversion rate of Litecoin here LTC to INR.
Despite their differences, both Bitcoin and Litecoin are amongst the world’s most trusted and known digital currencies. So much that people often consider Litecoin as complementary to Bitcoin instead of looking at it as its competition. If you wish to invest in either of these coins, you need to educate yourself about the speculative nature of the crypto market. We recommend that you go through professional and credible platforms such as Coinswitch to know more about these coins before making an investment.