Litecoin vs. Bitcoin | Empirex Capital

Litecoin vs. Bitcoin

Litecoin is a fork of Bitcoin — but how do the two currencies far when compared side-by-side?

Bitcoin and Litecoin are two of the most veteran cryptocurrencies, with the former launching in 2009 and the latter soon after, in 2011. Charlie Lee, a former Google engineer, presented Litecoin at its launch as the “light version of Bitcoin.”

Over the years, as new cryptocurrencies proliferate and attract ever more attention, both coins still remain highly popular. Bitcoin, of course, still occupies the top spot and remains the largest cryptocurrency by market cap.

Litecoin, meanwhile, hovers around 14th place (as of June 2021) and has been overtaken by newer currencies that have dominated the news cycle in recent times, such as Dogecoin and Binance Coin. However, Litecoin has held its ground as a sound crypto investment that has offered an incredible ROI to its long-term holders.

Design and Aims

At the highest level, Bitcoin and Litecoin are extremely similar. They are both decentralized cryptocurrencies created to support peer-to-peer (P2P) transactions. They are designed to serve as a medium of exchange and store of value while removing the need for a central party to serve as a guarantor, e.g. a central bank.

Algorithms

Bitcoin and Litecoin are both cryptocurrencies that use a proof-of-work (PoW) consensus mechanism to add new blocks to the blockchain.

Bitcoin’s algorithm is called SHA-256; Litecoin’s is called Scrypt

Block Sizes

A Bitcoin block will generally house around 1,500 transactions. Both Bitcoin and Litecoin have an original block size limit of 1MB. However, these limits can be superseded by using off-chain or layer 2 solutions to improve scalability.

Transactions Per Second

Litecoin has a maximum capacity for 56 transactions per second, whereas Bitcoin has a maximum capacity of only around seven transactions per second.

Transaction Fees

Another aspect that Litecoin has sought to improve upon is transaction fees. With Litecoin, users can expect to pay around $0.03 or $.04 on average in transaction fees. Compare this with Bitcoin’s more expensive $7.60 average transaction fee. Fees are lower with Litecoin because the network sets aside LTC that doesn’t derive from transaction fees in order to incentivize miners.

LTC vs BTC

Bitcoin’s value is hovering around $40,000 at the time of writing, with a $720 billion market cap. Litecoin is further down the list of currencies ranked by market cap and is currently valued at $175 per coin, with a $12 billion market cap.

What’s Next for Litecoin & Bitcoin?

There are many value predictions for both Litecoin and Bitcoin that range from highly conservative to extremely bullish. Both of these currencies are likely to retain their place as leaders in the crypto market, although there are some who believe that rivals like Ether could eventually overtake Bitcoin and seize the top spot.

Created on 25th Jun 2021

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