Without a doubt, network currencies have been a hot topic of discussion for more than a decade. However, not all people understand the Bitcoin Litecoin What Difference. In the current overview, we will analyze the main criteria for distinguishing between these two leading monetary systems.
Despite popular misconceptions, LTC is not the first fork of BTC. These are the digital asset and the Namecoin payment system of the same name. It did not prevent “Lite” system distribution from winning the title of virtual silver.
The year of 2011 was a turning point in the development of alternative monetary units. It was during the emergence of a significant number of digital assets based on the open-source code was initiated, and after that altcoins, the getting of which uses an algorithm which is different from the standard generation process.
“Bit” money was the first truly digital currency. It promised a future without banks, where businessmen could convert and send money to each other around the world quickly and securely. Typically, the first effective attempt to implement digital currency technology address is 26-35 characters long. Such an address consists of alphabetic and numeric characters and starts with "1", "3", or "bc1".
The most significant feature is its network commodity with a limited supply. Its algorithm is designed in such a way that a maximum of 21 million units can exist in the system. Each of them is called a BTC.
The emission schedule is programmatically determined and known in advance. After the last coins are generated, their number will not change. Such economy is built on a deflationary model many economists fear.
LTC is a network currency based on the most famous coin software and similar principles, such as:
The scheme was developed by former Google employee Charles Lee in 2011, and two years later it was positioned as an alternative to the existing BTC. The peculiarity of the fork is the openness of the source code, which allows anyone to change or copy the software. Lite money features the same procedure to generate addresses. The difference is the network prefix.
The modern currency runs on an open-source client program available on GitHub. The new software version 0.14.2. has improved security and performance settings. It is possible to combine with SegWit. The payment system first started working with such a protocol in April 2017, which led to an increase in the rate by almost ten times.
Speaking about the decentralization criterion, it can be noted that due to the lack of a single control center, platform participants receive the same rights and opportunities. It allows the system not to depend on the influence of states and companies.
These digital coins have another specific common characteristic, namely group mining. LTC is mined in the same way as the most glorious internet coin. As a rule, miners are combined into pools, which makes the process cheaper and more efficient.
First of all, these two currencies are similar in common system code. However, some code blocks have not been changed in the LTC system. Both of the modern currencies use the effective proof-of-work mechanism. It confirms the performance.
Bitcoin and Litecoin: What's the Difference?
Both virtual currencies are based on the one underlying blockchain and verification method. However, a few vital Bitcoin Litecoin What Difference features can help you to decide which is necessary for your goals and interests.
A feature of the most popular network technology constitutes the virtual database for transactional storage, the presence of a blockchain. Simply put, the record is stored on a network of thousands of computers called nodes. Users have a unique opportunity to send money to each other all over the world. They don't have to use banks or worry about high fees and exchange rates.
Transactions are grouped before being added to the blockchain. Nodes validate blocks. They are rewarded for the work they have done. The rewards are new coins and payment fees. On the currency invented in 2008, the reward is 12.5 new BTC. The process is called mining because it is like gold getting.
It is worth noting the main digital coin mining is an expensive undertaking. It requires a powerful computer. Besides, the process consumes a lot of electricity. It's also pretty slow. Each new block takes about ten minutes before being added to the blockchain. “Lite” system is superior to the other coin in this aspect.
Fast block generation allows fork system to process a higher volume of transactions. To achieve a similar level of processing, BTC would require a significant code update. The downside is that the LTC blockchain will be proportionately larger than the other “magic” Internet money.
Faster block times on the LTC network reduce the risk of double-spending. While it’s possible from a theoretical point of view if both networks have the same hashing power.
The first and most widely recognized digital currency mining algorithm is called SHA-256. That is what Charlie Lee managed to change. His algorithms are called scrypt. Getting the other virtual funds using scrypt is 4 times faster than SHA-256. Moreover, it requires much less electricity.
So, a recipient waiting for at least two confirmations will have to wait 5 minutes if the payment is made in the fork, while using the other Internet coin, they will have to wait 10 minutes for each confirmation. The reward for each confirmed block is 25 new Lite funds. The other crypto proponents are positive SHA-256 algorithms are more secure than scryp since SHA-256 takes longer and is more likely to catch bugs. In their opinion, scrypt speeds up the verification process too much.
Transaction speed (or block creation time) and confirmation speed are often viewed as controversial characteristics by many BTC users. Many services accept the digital currency and allow payments without waiting for confirmation for most purchases. You also need to keep in mind the payment is an instant process, but it is confirmed by the network as new blocks are added.
Nevertheless, LTC fans are sure Charlie Lee's changes to the main crypto's rules are much better. The thing is that the aspect makes the first type of money a cheaper and faster platform. Not a single blockchain has been hacked.
It's no secret investors are obsessed with virtual currencies. Some of them manage to become filthy rich by trading such currencies. Some experts advise against investing in cryptocurrencies now. They believe the popularity of the digital gold is part of an investment bubble.
Buying Bitcoin is now expensive and a bit risky. As an investment, it may be too late to start buying even after looking at the general forecast. The price has dropped a lot the previous year. However, LTC is newer and could become as glorious as the other virtual money. Its exchange rate grew slowly but steadily.
Characterized by a market capitalization of $1.163 trillion, “Bit” money is the undisputed leader in the market cap table. At the moment of writing the article, “Lite” money is ranked 18th with a market capitalization of $13.6 billion.
Crypto system has not completely replaced money yet, as you can hardly pay with it in a regular supermarket. However, today there are already many well-known businesses accepting the main network money as payment. Considering the other virtual financial system, there are far fewer organizations accepting it as payment.
Although LTC is not as popular as BTC, its technology is more suitable for everyday spending. The payment times are four times faster than the other system. It can attract various enterprises and regular customers, so they will start using LTC instead of the other currency which is more popular and accepted as payment in different places. It also uses zero-confirmation transactions to make purchases faster.
Both cryptos want to reduce payment times using the Lightning network. The Lightning Network is a way to verify transactions outside of the main blockchain. The miners will have less work to do and the whole system will run faster.
Both coins started using the Lightning Network. However, some people are positive the most famous network coin's use of the Lightning Network will spell the end of the “silver” money. They believe faster transaction times will render LTC worthless. However, the introduction of the Lightning Network is likely to bring the two systems closer together.
The crucial difference between these cryptos is the way mining works on each platform. Bitcoin getting is much more difficult and expensive than the other one. So, to bring home the bacon through BTC operations, you need an extremely powerful computer.
The majority of common people make use of specialized mining machines called ASIC miners. As the value of it has risen, mining has become a separate industry. Entire warehouses have been converted for it mining. To cut a long story short, new types of “bit” money are being mined by fewer and fewer people.
The risk here is a high percentage of the total supply of the first successful attempt to implement cryptocurrency technology will be owned by a small number of people and organizations. Cryptocurrencies should be decentralized. They were created to distribute wealth more evenly. It can also be argued the amount of energy used to mine BTC is harmful to the environment.
Currencies, like gold, can be stores of value. The currencies of some countries are better stores of value than weaker and less stable countries. Cryptocurrencies are still new. However, they have the potential to become a store of value.
Gold is an excellent store of value since it is precious. Besides, there is a limited supply of it in the world. Gold protects against inflation. Simply put, its value does not increase much. Its value is predictable and reliable. This aspect also works in the case of the decentralized money. They both have limited supplies. There will be 21 million “Bit” money in total and 84 million of the other crypto. Therefore, they can both be good value stocks.
Bitcoin is the oldest and most reliable crypto funds. It will also reach its supply limit first. Three-quarters of the crypto has already been mined. This means its value should become predictable and reliable soon, like gold. The forecast for it is that it will become a store of value.
Mining a cryptocurrency founded in 2011 is much easier. Unlike BTC, a more simplified Scrypt standard is used here than the SHA-256 algorithm. There is an reasonable explanation: virtual silver was created taking into account the technical features of the main crypto.
The professionalization of the mining industry and the constant increase in the complexity of the network of the first digital asset can serve as some, but not an indisputable indicator for correctly determining what is better to mine – LTC or BTC?
The generation of virtual BTC coins is associated with a solid investment. Against the backdrop of the loss of profitability of solo mining, there was a need to purchase expensive computing equipment, called ASIC. Its cost starts from 500 and reaches 10 thousand US dollars. In addition, you need to purchase at least a few ASICs. Without any doubt, this is not always affordable for common people. Let’s take a look at the following alternative options.
Computer savvy miners are able to assemble a mini-farm of 5 or more video cards at home. However, it is quite difficult to count on making a solid profit in this way.
It’s common knowledge that the popularity of cloud mining services for cryptocurrencies has been growing rapidly in recent years. Despite the presence of reliable service providers on the market, the issue of fraud does not lose its relevance. A separate problem is the payback period of packages. It usually depends on the exchange rate fluctuations of digital coins.
When determining which is more profitable, one should take into account the possibility of generation by participating in the work of pools. These voluntary associations of miners can consist of hundreds of thousands of PC owners. The thing is that the issue of fraud is acute in this segment.
Nevertheless, it is possible to neutralize the existing risks, to become a member of solid platforms that allow engaging in an integrated generation. To cut a long story short, the administration of some resources has developed a mechanism that ensures automatic switching to the generation of various digital assets, the extraction of which is the most profitable at a particular moment. “Lite” money is one of those coins.
Many people still believe Bitcoin is the only crypto worth using to get rich. So if you are one of those people, remember that BTC cannot serve the whole world despite the fact that it overtakes Litecoin. It is believed BTC only supports about 500 million users. This is about 15% of the world's population. There is room in the market for other coins. “Lite” funds are one of the most powerful crypto coins.
Comparing the key characteristics of these cryptocurrencies involves describing the similarities and differences between these systems.
This is hardly the case. The fact is that BTC crypto is considered a leader due to brand awareness. However, do not forget the fastest peer-to-peer cryptocurrency features plenty of advantages. Among the main ones should be distinguished:
If we compare the categories of payment speed of these crypto funds, we can note LTC overtakes BTC crypto. So, Bitcoin crypto features perform 4-7 transactions per second, and confirmation takes 10 minutes. However, Litecoin is able to perform 56 transactions per second and only requires a 2.5 minute confirmation time.
The future of this crypto is directly related to the mood of investors and consumers. Government regulations, state-sponsored cryptocurrencies as well as economic conditions affect Litecoin.
Speaking about the crypto distribution, the Litecoin supply is capped at 84 million.