What do you think about when you hear the word Cryptocurrency? Many people think of Bitcoin, especially those who are new to this world. It makes sense because Bitcoin is the most popular digital currency.
People new to the world of Cryptocurrency think there are no other currencies. Being the most popular Cryptocurrency doesn’t mean it is the best. That is why developers created some other alternative currencies.
What is Litecoin?
Developers modified the code to create new coins that are better. On the 7th of October 2011, Charlie Lee created an alternative coin called Litecoin. Lee said that he made it overcome the flaws of the current Bitcoin code.
Charlie said that Litecoin cryptocurrency is not meant to compete with Bitcoin. Instead, he wants it to provide people with an alternative exchange solution. It is now considered the silver of digital currency.
How Does Litecoin Differ From Bitcoin?
So what is the difference between Litecoin and Bitcoin? What is Litecoin used for and which one is better? Well, let’s find out in this article.
Before we talk about differences, let us discuss the similarities. Both coins are open source code. They are safe to make payments with and are not owned by any authority. Anyone can view the logs or history of transactions online.
Most alternative coins suffer from problems with liquidity. But, that is not the case with Litecoin as it is one of the oldest alternative coins and has a long-standing history.
One of the key differences between Bitcoin and Litecoin is the transaction speed. This is due to the time taken for confirmation of the transaction. Litecoin has shorter block time.
|Founder||Charlie Lee||Satoshi Nakamoto|
|Release Method||Gensis Block Mine||Gensis Block Mine|
|Supply amount||84 million||21 million|
|Usage||Silver Digital money||Gold Digital money|
|Transaction Fee||0,001 LTC average||Varies based on block chain|
|Block time||2.5 minutes||Minimum 10 minutes|
Charlie based Litecoin on the skeleton of Bitcoin’s code. But, he made some tweaks and modifications to the code. Those tweaks enabled Litecoin to offer a faster exchange and to its traders.
In fact, the block confirmation time of Litecoin transactions is 2.6 minutes. Compare this to the 10 minutes period required by Bitcoin for transactions. This is a fourfold increase in transaction speed.
This big difference helped large volume transactions to be done faster. This made Litecoin a good choice when wanting to trade fast and instantly.
The core code of Bitcoin is SHA-256. Lee changed this into a memory intensive code, known as the Scrypt algorithm. The script algorithm does not work in favor of concentrated mining pools.
What about the total available supply of each coin? The idea of having a limited supply creates a value to Cryptocurrencies. Bitcoin has a supply limited to 21 million coins.
How many Litecoin are there?
It shows a fourfold increase by having 84 million coins. The number of circulating Litecoins is approx. 53 million and the rest is awaiting mining.
The mining rate of Litecoin is 2.5 minutes per block which generates 25 coins. The blockchain technology of Litecoin makes it competent.
Uses of Litecoin Vs Bitcoin
Let us look at what is Litecoin used for compared to Bitcoin.
Over the years, Litecoin has proven to be less volatile than Bitcoin. Moreover, it has fewer fees per transactions. This makes it a preferable choice for merchants.
The above plus the faster transaction rate make Litecoin an appealing option to many. If you want a less volatile, long-term and large volume, low-risk investment, go for Litecoin.
People can use Bitcoin for all purposes, for example, to pay online or to store it. Some people call this the digital gold. Yet, that applies to most cryptocurrencies also.
Charlie made Litecoin for bulk transactions because of its speed and minimal fees. In other words, Bitcoin seems like a better store of value. Yet, you can use both Bitcoin and Litecoin for making payments or a store of value.
Other uses for Cryptocurrencies include deals that involve contracts. Real-estate companies and some corporations use Ethereum cryptocurrencies for creating smart contracts. These contracts seal deals in codes in block chains once the two parties agree on the terms.
These contracts are safe from tampering with. So depending on the kind of use you want, pick your currency.