Bitcoin Vs Litecoin

Bitcoin vs Litecoin… Bitcoin has long been the dominant name in the cryptocurrency world, and it has been hard for other cryptos to stand out. But, Litecoin is one of only a few cryptos to make a real name for itself, and therefore Litecoin (LTC) vs Bitcoin (BTC) presents an interesting thread of comparison. So, if you are wondering which to buy, Bitcoin vs Litecoin, or which is better, read this article for a comparison of the similarities and differences in 2022, and their respective benefits.

What Is Bitcoin?

Before we start comparing Bitcoin vs Litecoin, let’s first look into Bitcoin’s history, uses and where to find price charts and graphs. Bitcoin was first announced in 2008 by a person or group using the pseudonym Satoshi Nakamoto. The first block was mined on January 3rd, 2009, starting the course of blockchain Bitcoin mining as we know it today. For years, the price of Bitcoin remained low, reaching an unexpectedly high peak of $1,242 in 2013. But it was not until 2017 that Bitcoin truly boomed, resulting in huge profits for anyone who had made early investments in the token.

In December 2017, the price reached an all-time high of $19,783.06, and although it fluctuated following this, new highs kept being hit. November 2020 saw a new all-time high of $19,850.11. But, a steady bull run since then has meant huge hikes, and as recently as September 2021 the price reached $50,128. Today’s value can be monitored on CoinMarketCap.

Bitcoin is a decentralized, digital currency – i.e a list of transactions that are stored on a blockchain ledger that state that person X sent Bitcoin to person Y. The blockchain stores information in blocks which are then mined, verifying each transaction and ensuring the same Bitcoin cannot be sent twice. Bitcoin’s uses have grown massively throughout the years. Since the 2017 boom, many companies, such as Expedia, have started accepting Bitcoin as a form of payment. One of the main uses is to try and get rich by trading Bitcoin, the large fluctuations present traders with lots of opportunities. Moreover, El Salvador became the first country to officially adopt Bitcoin as a legal tender in June 2021, showing how strong the world regards its potential.

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What Is Litecoin?

When comparing Bitcoin vs Litecoin, there are similarities in Litecoin’s origin. Like Bitcoin, Litecoin is a decentralized, digital currency founded two years after Bitcoin in 2011. It was created by a former Google engineer named Charlie Lee, describing it as the “lite version of Bitcoin”. At the time, Bitcoin had become very expensive to mine in terms of both energy, power consumption and equipment. Mining was largely being performed on GPUs; makings CPUs obsolete when it came to mining. Litecoin was set up with a source code fork of the Bitcoin Core client.

Litecoin is not issued by a government and is not regulated by a central bank. Instead, trading is carried out on a peer-to-peer basis, directly between holders. Payments are verified through the proof-of-work algorithm. In 2017, the price of Litecoin skyrocketed, as happened with Bitcoin and many other cryptocurrencies at the time. The value went from merely $4.05 to a peak value of $237.57. Litecoin did not hold its value as well as competitors, but it did reach an all-time high of $255.79 in April 2021. Today, the price sits around $184, and the exact value can be found on CoinMarketCap. Litecoin has many uses. One of the most popular is to trade Litecoin for profit, aiming to use the daily fluctuations for investors’ advantages. Other than this, Litecoin can be used to pay for many services, including tea, coffee, pet products and even houses through RE/MAX in London.

Bitcoin Vs Litecoin Similarities

On the surface, when comparing Bitcoin vs Litecoin, you’ll see they are fairly similar. Both are decentralized currencies, which, unlike regular fiat currency like US dollars or pounds sterling, means they do not rely on the backing of central banks for value and circulation control. Moreover, they can both be traded on decentralized exchanges (DEXs), peer-to-peer (P2P) crypto exchanges and centralised exchanges. Some of the key similarities are:

Proof Of Work

One obvious similarity when comparing Bitcoin vs Litecoin is that they both use the proof-of-work (PoW) ecosystems. This is a system that requires an amount of effort to deter frivolous activity, such as attempting to use the same coin twice. For both Bitcoin and Litecoin, proof-of-work is the process by which both are mined, indicating a relationship between the two. This simultaneously generates new coins, authenticates them, verifies transactions and adds them to the blockchain. In both cases, cryptocurrency miners solve mathematical puzzles of increasing difficulty by using a hash algorithm to generate the correct answer. This results in them being rewarded with new coins.

Storage And Transactions

Storage and transactions present another fundamental similarity in Bitcoin vs Litecoin. The two cryptocurrencies are known for their easy transaction facilities. As mentioned, they can both be bought or exchanged using many online crypto exchanges and can be mined using a mining rig. In addition to this, Bitcoin and Litecoin require a wallet to store the currency. Hot or cold wallets are suitable for either. Finally, as with all cryptocurrencies, they’re subject to huge volatility which can result in large price increases and drops.

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Bitcoin Vs Litecoin Differences

While the similarities between Bitcoin vs Litecoin tend to be clear, the differences are a little more interesting:

Market Capitalisation

Market capitalisation is one area of Bitcoin vs Litecoin that features large differences. This itself is not too surprising, Bitcoin is by far the largest of all cryptocurrencies. As of September 2021, Bitcoin had a staggering market cap of $814 billion, eclipsing the next closest crypto, Ethereum, which had a market cap of $359 billion. In September 2021, Litecoin had a market cap of only $10 billion, smaller than Bitcoin by a ratio of over 80:1 and ranking 17th out of all cryptos. In August 2020, Bitcoin had a market cap of $215 billion while Litecoin’s was around $3 billion. Looking further back to August 2017, around the peak of the first crypto boom, Bitcoin was averaging $320 billion vs Litecoin’s $17 billion.

Distribution

Distribution is another factor that differs when comparing Bitcoin vs Litecoin. Litecoin can accommodate a total of up to 84 million tokens, whereas the Bitcoin network can never exceed 21 million. On the outside, this sounds like an advantage for Litecoin, more coins would make it easier to pay small amounts. However, both Bitcoin and Litecoin are divisible by very large amounts. The minimum transferable quantity of Bitcoin is 0.00000001 Bitcoins. This means that, no matter how high the price of a Bitcoin gets, it will still be possible to pay small amounts.

Transaction Speed

The transaction speeds of Bitcoin vs Litecoin vary significantly. Although transactions technically happen instantaneously on both blockchains, these transactions still must be confirmed by other network participants (miners). Litecoin was designed and founded with the idea that transaction speed would be prioritized. The average time for a block to be verified and added to the blockchain on the Bitcoin network is around 10 minutes, while on Litecoin it is roughly 2.5 minutes – four times quicker. This could make Litecoin a more appealing option for merchants as they would receive confirmation of payment in a much shorter time. The merchants do not have to wait for confirmation, although this would make the Litecoin security much stronger vs Bitcoin with no confirmation.

Algorithms

This represents the largest technical difference between Bitcoin vs Litecoin. Bitcoin uses the longstanding SHA-256 algorithm, whereas Litecoin uses a newer algorithm known as Scrypt. These algorithms impact the mining process. Both Bitcoin and Litecoin require substantial amounts of computing power, but SHA-256 is a more complex algorithm. Application-Specific Integrated Circuits (ASICs) dominate the Bitcoin mining world. These are hardware systems that are tailor-made for mining Bitcoin and they are generally very expensive both in terms of cash and energy use. Litecoin’s Scrypt, on the other hand, is less susceptible to ASICs, and as a result, CPUs and GPUs can still be used to mine Litecoin, making it much more accessible. When you take all this into account for Litecoin vs Bitcoin, a mining profitably calculator will say that Litecoin is the better option since the hardware is much cheaper.

Value And Fees

Bitcoin vs Litecoin values vary significantly. One Bitcoin is worth substantially more than one Litecoin. In September 2021, one Bitcoin was worth $43,000, whereas one Litecoin was $150, a minuscule amount in comparison. Bitcoin vs Litecoin transaction fees are also very different. Litecoin users can expect to pay around $0.04 on average per transaction, whereas Bitcoin charges an average of $7.60 per transaction. The main reason for this difference is that Litecoin sets aside currency to incentivise miners, while Bitcoin derives this directly from transaction fees.

Pros Of Bitcoin For Traders

These are the main advantages of trading Bitcoin in our eyes:

  • High liquidity
  • Very large trading volume
  • Most valuable cryptocurrency
  • High volatility (amplified by value)
  • Largest market cap of any cryptocurrency
  • More accessible (almost every exchange offers Bitcoin)

Pros Of Litecoin For Traders

Our research found these advantages of trading Litecoin:

  • Low transaction fees
  • Fast transaction speed
  • Trustworthy developer team
  • Energy-efficient mining process
  • Larger upper limit of coins, reducing inflation risk
  • Constant improvements are being implemented, such as the Lightning Network protocol

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Bitcoin Vs Litecoin Verdict

Bitcoin vs Litecoin are two of the original cryptocurrencies, being founded in 2009 and 2011 respectively. The two coins have benefitted greatly from price booms in the crypto world, seeing their values skyrocket compared to their initial value. Today, there is a large difference between the two, as Bitcoin dominates the market both in terms of value and market cap. Still, Litecoin does have its advantages, including quicker transaction speeds and more efficient mining. The two currencies are both important to the decentralized world and have proven to be worthwhile investments to this day.

FAQs

Is Bitcoin Vs Litecoin A Better Investment?

It is hard to give a definitive answer a to which of Bitcoin vs Litecoin is a better investment. Both have their benefits, and the profitability will depend on the market conditions at the time of investment.

Are Bitcoin Vs Litecoin The Same?

No, Bitcoin vs Litecoin are not the same. They share similarities and they are both decentralized currencies, but there are fundamental differences between the two coins.

Can I Send Litecoin To A Bitcoin Address?

No, you cannot send Litecoin to a Bitcoin address and vice versa. Doing so will result in the coins being lost.

Where Can I Find Litecoin And Bitcoin’s Values?

Values for both Bitcoin vs Litecoin can be found online at crypto information websites like CoinMarketCap. These are regularly updated along with rankings of the different cryptocurrencies.

Can Litecoin Overtake Bitcoin?

Whether or not Litecoin can overtake Bitcoin is a matter of speculation. Bitcoin is the original cryptocurrency, and the likelihood of it being surpassed by Litecoin is slim. In reality, if Bitcoin were to be usurped, it would be one of the larger cryptos such as Ethereum that did it.