Litecoin (LTC) vs. Bitcoin (BTC)

If you are new to the world of cryptocurrency, you are probably unaware of how many digital currencies have become available in the last decade. Hint: it’s a lot. Many have had their ups, many more have had their downs, and a few have met its’ demise.

Bitcoin is all the rage, and more and more people are throwing their life savings into Bitcoin, with the hope that it will skyrocket again over the next year. But is Bitcoin really the best investment in the cryptocurrency world? Let’s take a look at Litecoin, a digital currency that has dubbed itself the ‘silver’ to Bitcoin’s ‘gold,’ and find out.

The Technicalities

1. 1. The maximum number of Litecoin is significantly higher

Although Bitcoin is the highest valued digital currency, it has lowered in value from its all-time high in the winter of 2013 (from $20,000 to $12,000). Since Litecoin is able to house about 84 million coins, which is significantly higher than Bitcoin’s 21 million, Litecoin is somewhat at an advantage. This is because more quantity means a cheaper price per coin.

While those buying into Bitcoin are usually left having to settle for only a fraction of a full coin, the sheer amount of Litecoin available allows for the purchase of whole units. It becomes confusing to calculate the value of a fraction of a coin, but this is not much of a downside or problem today considering the number of Bitcoin wallets available, like Electrum or Multibit, that allow you to view your digital currency in terms of fiat currencies such as the dollar, the euro, or the pound.

1. 2. Litecoin has a faster processing period

While Bitcoin takes about 9 minutes to complete a transaction that has gone through network participants, Litecoin takes a mere 2 and a half minutes. This difference in time may appear insignificant considering the 7-day period normal banks take for international transactions, but businesses and merchants in particular are bound to find this speed attractive. Time is money, after all.

1. 3. Mining Litecoin requires less processing power

These two coins employ different algorithms. While Bitcoin employs the SHA-256 algorithm, which puts processing power above all else, Litecoin uses Scrypt. Scrypt is known for preferring high-speed random access memory over the processing power that the SHA-256 algorithm favors.

Another key difference that the use of two distinct algorithms makes is that the Scrypt algorithm, unlike the SHA-256 algorithm, may be used successfully on a personal computer that is not nearly as powerful as the common mining computer. This means mining Litecoin is made possible for those that are not able to afford a high-powered mining device, opening the possibility of mining to the public.

The Practicalities

1. 1. Litecoin can actually be used as a currency

While Bitcoin remains the most popular and valuable digital currency, it has become impractical to use in daily transactions due to its high transaction fees and slow transaction time. Litecoin, on the other hand, was created to make transactions faster and cheaper. While Bitcoin will remain a great investment, Litecoin is more practical to use as currency.

1. 2. Emerging markets are fully on board with Litecoin

Litecoin has gained significant market share in several emerging markets and is continuously being adopted by more and more merchants for its stability and easy transaction experience. Many investors in Asia and Africa prefer Litecoin due to its lower volatility, and its active team and founder who are constantly working to tweak Litecoin.

1. 3. Your money Is safer in Litecoin than Bitcoin

Bitcoin, being the most popular and valuable digital currency on the market, is more susceptible to hacking – even on the biggest cryptocurrency exchange platforms (see the Binance hacking incident in May 2019). With Litecoin, security is almost a non-issue. The presence of a team that is constantly fixing and adjusting Litecoin allows it to stay much more secure than Bitcoin and other competitors; no giant hack has ever occurred with Litecoin.

1. 4. Litecoin makes It cheaper to trade in Bitcoin

Litecoin’s fees are much cheaper than Bitcoin’s, with just a few cents compared to the several dollars it takes for every Bitcoin transaction. As Bitcoin intends to remain the same for the entirety of its lifespan, we can’t really expect for fees to get lower. On the bright side, Litecoin allows Bitcoin holders to convert Bitcoin assets into Litecoin on its blockchain, allowing people to trade Bitcoin with each other by using Litecoin.

1. 5. Litecoin Isn’t a victim of pump & dumps

Bitcoin and Ethereum both suffer from volatility, leading to many speculating that they exist in a bubble that will soon pop. Whether or not this is true, this instability makes it difficult for even the most adventurous investor to go all in, knowing that they might lose a significant chunk of their investment overnight.

Litecoin’s growth has been very different from Bitcoin’s over the past few years. A slow and genuine growth has allowed Litecoin to gain the trust of investors, and everyone who has given Litecoin a shot has realized its true potential to replace fiat currencies in daily transactions.

Summary of Differences

Conclusion

if you are building a cryptocurrency portfolio, it would be advisable to invest both in the Litecoin and Bitcoin. Although the Litecoin still hasn’t reached the high regard that Bitcoin has steadily held over the past decade, it is filled with promising potential.