January 7th, 2018
What’s The Difference Between Bitcoin And Litecoin?
Over the past few years, public interest in digital currencies has increased dramatically. The public’s main focus has been on Bitcoin, which first came on the scene in 2009. In the past four years, Bitcoin has become the dominant name in the digital currency market. However, many other digital currencies are still at play. Among these other digital currencies rising to the surface, Litecoin, is beginning to draw more attention. Litecoin’s developers have stated that their main intention for creating Litecoin, was to create a “silver” to Bitcoin’s “gold”.
Generally speaking, Bitcoin and Litecoin have quite a bit in common. At the most basic level, both are cryptocurrencies. Unlike traditional currency digital currency relies on the integrity of the network itself, not a third party entity or central bank. So the idea for both of these cryptocurrencies is similar, but that’s about where it ends. Below you will find more information on some of the major differences between Bitcoin and Litecoin.
Currently Bitcoin’s market capitalization is about $ 4 billion. If you consider that in 2010 Bitcoin’s market capitalization was around $42,000, the current figure seems like a pretty big deal. It’s easy to see that Bitcoin is the most highly valued player in the cryptocurrency market.
One fundamental technical difference between these two currencies is that they have different cryptographic algorithms. Bitcoin uses the long standing SHA-26 algorithm, while Litecoin uses a newer algorithm named Scrypt. The main difference between these two algorithms is the impact on the “mining” process of new coins. With both currencies, the process of confirming transactions requires considerable computing power. Miners allocate their computing resources to confirm other users transactions. In exchange for “mining” miners are rewarded with the unit of currency in which they mined.
Another difference between Bitcoin and Litecoin is the total number of coins that each digital currency can produce. Litecoin’s network can accommodate around 84 million coins, whereas Bitcoin can never exceed 21 million coins. This may sound like a significant advantage for Litecoin, but it reality its effects may be negligible. The reason is because both Litecoin and Bitcoin are divisible into infinitesimal amounts. Users of both currencies should not have trouble buying low priced services or goods, regardless of how expensive the general price that a single coin may become.
Technically speaking, transactions occur instantly with both Bitcoin and Litecoin networks, time is required for these transactions to be confirmed by network participants. According to data, Bitcoin averages confirmed transaction time takes about 9 minutes per transaction. Litecoin, on the other hand, only takes about 2.5 minutes. This time difference, could make Litecoin a more attractive digital currency for some merchants. Especially in today’s “fast” culture.
Bitcoin and Litecoin are considered to be the gold and silver of the cryptocurrency market. Historically, this dynamic and emerging market sector has shown that it can change immensely in just a couple months. It is important to become familiar with the currency that will be able to retain its stature in the coming years. Currently Bitcoin is leading the race and is considered to be the most popular digital currency ever.