Litecoin vs. Bitcoin: How Are They Different?

Since its launch in 2009, Bitcoin has been almost synonymous with Crypto for most of the past decade. It introduced a completely new asset class, now widely used by both retail and institutional investors. For the first time since gold, an asset had intrinsic value, built on a scarcity-driven model.

However, Bitcoin’s impact went beyond just creating a new asset class. It sparked innovation, leading to the development of numerous Crypto tokens with unique applications. One such token, Litecoin, emerged from a Bitcoin blockchain hard fork. A hard fork occurs when a disagreement within a blockchain network results in a split, creating a new chain with its own token.

What is Bitcoin?

Bitcoin was created by Satoshi Nakamoto in the wake of the 2008 global financial crisis. It was created as an alternative to traditional finance. Bitcoin transactions are recorded on the Bitcoin blockchain which is an open-source decentralised ledger. The Bitcoin blockchain is also immutable, meaning that transactions recorded on the blockchain cannot be erased. 

Read more: The evolution of Bitcoin Mining from Solo to Institutional Giants

What is Litecoin?

Litecoin is a Crypto token launched by Charlie Lee in 2011. It was aimed at removing the limitations of Bitcoin. The first meteoric rise of Bitcoin( BTC) price during 2009-11 saw several first movers trying to get their hands on the asset. 

During this rise, it became increasingly difficult to mine Bitcoins because of the rising computational power required during the Proof-of-Work consensus mechanism. Bitcoin mining infrastructure known as Application-Specific Integrated Circuits (ASIC) became increasingly expensive. It became harder for ordinary crypto enthusiasts to engage in Bitcoin mining. Increasing costs also meant that fewer people can purchase the infrastructure which could lead to centralisation.

Litecoin was created to overcome this limitation of infrastructure cost and centralisation by using a mining algorithm called Scrypt. 

Read more: Litecoin Halving

Key Differences Between Bitcoin vs. Litecoin

While mining algorithms and infrastructure cost are two key differences, many other features set them apart:

Is Litecoin Better Than Bitcoin?

We’ve explored the key differences between Bitcoin and Litecoin, but the bigger question remains—which one stands out?

Litecoin was designed to offer a more accessible and decentralised mining process. However, advancements in mining technology, particularly Scrypt ASIC miners, have led to a more concentrated mining ecosystem, with a handful of pools dominating the network.

Bitcoin, on the other hand, holds an unmatched reputation in the crypto space. Often called “digital gold,” it has remained a formidable asset since its inception. Its blockchain benefits from a significantly higher hash rate, making it far more secure and resistant to attacks. The immense computational power required for a 51% attack ensures Bitcoin’s network remains one of the most robust.

Moreover, innovations like the Lightning Network are addressing Bitcoin’s scalability challenges. If transaction throughput improves further, Bitcoin could evolve beyond a store of value and become a viable option for everyday transactions.

Read more: How Do Miners Earn Block Rewards?

Conclusion

Both Litecoin and Bitcoin have thrived for over a decade, each excelling in its own way. Bitcoin stands out with its unmatched decentralization, robust blockchain security, widespread adoption, and strong reputation as a trusted crypto asset. Litecoin, on the other hand, offers faster on-chain transaction speeds, making it an efficient option for quick settlements.

With innovations like the Lightning Network enhancing Bitcoin’s scalability, both assets continue to evolve, complementing each other in the broader crypto ecosystem. Their unique strengths ensure they remain valuable choices for different use cases in the ever-growing digital economy.

You can now buy Bitcoin and Litecoin on ZebPay!