Bitcoin vs. Litecoin: What’s the Difference?

Bitcoin vs.  Litecoin: What’s the Difference?

Litecoin was created to be the silver to Bitcoin’s gold, running faster and cheaper than Bitcoin. However, it doesn’t have much else to offer.


Litecoin is the oldest cryptocurrency alternative still in operation today, and has a few major differences compared to Bitcoin. Dozens of alternatives to Bitcoin were invented during the first years of blockchain, but the overwhelming majority of them failed to achieve sufficient adoption and have since become dead blockchains. Bitcoin’s mysterious creator, Satoshi Nakamoto, pioneered blockchain as a technology for decentralized digital currencies, but there are several problems with Bitcoin’s design that prohibit its use for day-to-day transactions.

TODAY’S SCREEN VIDEO

Before the invention of Ethereum, creating a cryptocurrency meant launching a new blockchain network and hoping that cryptocurrency miners would join the network, and because of this major adoption barrier, there are very few cryptocurrencies created before Ethereum that are still alive today. It was 2013 when cryptocurrency’s first “altcoin season” came with the invention of dozens of alternative cryptocurrencies, each trying to solve some problem using cryptocurrency, many of which didn’t make sense to solve and were obvious cash. Today, the majority of these early altcoins are dead, with only a few surviving over the years.

Related: Solana vs. Ethereum: What’s the Difference?

Litecoin (LTC) was one of the earliest altcoins ever created that is still alive today. Investopedia explains that Litecoin was split from Bitcoin in 2011 to address growing concerns that Bitcoin was becoming too centralized by large Bitcoin miners. While Litecoin ultimately failed to achieve its purpose as a lighter and more decentralized alternative to Bitcoin, it has since survived the many ups and downs of crypto market cycles. Years after Litecoin was created, Dogecoin was created as a joke during the 2013 altcoin season, but due to its (intentionally) terrible economics, it became unprofitable to mine. Dogecoin and Litecoin developers responded by creating a “merger mining” system where all Litecoin miners automatically mine Dogecoin at the same time, allowing them to validate transactions on both networks simultaneously. This system is the only reason Dogecoin still exists today, and the largest DOGE holders are theorized to be Litecoin miners.


Digital silver to Bitcoin’s digital gold

Silver coin with Litecoin logo on black background

Litecoin is often described as “the silver to Bitcoin’s gold”. Litecoin was designed for daily purchases by being cheaper and faster than Bitcoin, but today’s smart contract blockchains offer faster and cheaper transfers and can host stable coins that have no volatility, negating the purpose Litecoin and Bitcoin were both created for. Litecoin was designed to have faster transaction times than Bitcoin, with Litecoin transfers taking around two minutes compared to Bitcoin’s 10 minutes. This was a huge improvement over Bitcoin’s design, but today it is ridiculously slow compared to modern blockchains that can process transactions in seconds with minimal environmental impact.

Just like Bitcoin goes through a halving event every four years, Litecoin also has its own halving event that happens over a similar time frame. However, Litecoin’s halving events do not have a significant impact on the cryptocurrency market the way Bitcoin’s halving events do, and to date the only thing that seems to affect Litecoin’s price is the speculation that follows in the months following a Bitcoin halving event. Litecoin will always be significantly cheaper than Bitcoin, as Litecoin has four times the circulating supply of Bitcoin and will peak at 84 million LTC.

A staple of the cryptocurrency industry due to its age, Litecoin is the oldest surviving altcoin that has retained any significance. Although Litecoin was created to be a lighter and cheaper alternative to Bitcoin, it has since become obsolete for everyday purchases due to the innovation of smart contract blockchains that came many years later. Today, Litecoin is treated as digital silver in the same way that Bitcoin is treated as digital gold, but outside of recent developments that add privacy coin features, it doesn’t have much else to offer the modern blockchain industry.

Next: What is the difference between Ethereum and Polygon?

Source: Investopedia

See also  'Going Rogue'—Major Crypto Investor Issues Serious SEC Warning After Wild Bitcoin and Ethereum Price Swings

You may also like...

Leave a Reply

Your email address will not be published. Required fields are marked *