Not only beginners in the trade with crypto currencies ask themselves: Is Bitcoin (BTC) without alternative or is it worthwhile to have a look at competing offers like Litecoin (LTC). Here we explain the differences between BTC and LTC.
Bitcoin (BTC) marked the beginning of the still young history of crypto currencies in 2009. Already in 2011, Litecoin (LTC) was launched as an alternative to BTC. LTC was developed by a certain Charlie Lee, who set himself the goal of improving Bitcoin’s code. On the one hand, the speed of the Blochain was to be increased and, on the other, the mining of new coins was to be simplified. Lee was still working at Google at the time, later moved to Coinbase and is now the head of the Litecoin Foundation. LTC has at least partially lived up to its claim to make Litecoin a “digital silver” in the same way as the “digital gold” Bitcoin. With a market capitalization of currently over 3 billion US dollars, Litecoin ranks confidently in the top ten most important crypto currencies. Bitcoin, however, with a market capitalization of more than 200 billion US dollars, is in a league of its own.
Technological comparison of Bitcoin and Litecoin
At BTC, the maximum number of all Bitcoins to be generated is fixed at 21 million and a new block is produced approximately every ten minutes. Following the Bitcoin Halving in May, each new block now contains 6.25 BTC rewards for miners.
Lee took the original code from Bitcoin for Litecoin and rotated the core content by a factor of 4. Accordingly, the maximum number of all LTC is limited to 84 million, a new block is created every 2.5 minutes, and after the August 2019 Litecoin Halving, each new block contains 12.5 LTC reward for Miner.
The concept of mining has changed Lee somewhat compared to BTC. At Bitcoin, the SHA-256 hash algorithm performs cryptographic tasks that require a lot of processing power in the CPUs. This led to the development of ASIC miners, special hardware for miners. Lee wanted to make mining possible for everyone and used the Scrypt algorithm for the task. Scrypt accesses fast RAM and so, initially, powerful graphics cards were the typical hardware for miners in LTC. In the meantime, however, there are also ASICs that are optimized for Litecoin Mining.
LTC and BTC in everyday life
Lee’s main focus at Litecoin is on the suitability for everyday use. Because the typical ten minutes of waiting time plus fluctuating transaction fees for a payment or transfer in Bitcoin are not very attractive for small amounts and fast transactions. Litecoin scores here with speed and fees of a few cents. In addition, Litecoin opened up technologically early for Segwit and the Lightning network, two protocols that further increase the performance of a block chain.
Conclusion: Buy Bitcoin or consider Litecoin?
For you as an investor it is important to become clear to you about what your investment in crypto-currencies should aim at. If it is intended as a store of value or if you want to realize profit opportunities with financial instruments such as futures or options, Bitcoin remains the first choice. The “digital gold” BTC is the leading currency in the crypto market, where liquidity is gathered and thus provides a wide range of options for traders.
Anyone who simply wants to turn away from Fiat and pay with crypto in everyday life is probably better off with Litecoin. The “digital silver” LTC is accepted by many online traders as a payment method and can be used almost everywhere (converted to Fiat) for payments via a Coinbase credit card, for example. However, Litecoin has seen strong competition, especially with Bitcoin Cash (BCH), and the price curves of the two Altcoins have stagnated over a long period of time.
Medium and long-term thought is probably Bitcoin the safest value investment in the crypto market. Litecoin shows its strengths where crypto should arrive in everyday life. Compared to BCH, LTC has a long history without scandals and security holes. You will divide your investments if necessary, in order to have the desired crypto currency at hand in every situation.
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