The modern-day currency landscape has seen the emergence of digital money in recent times which have attracted a lot of attention from potential investors and traders. Cryptocurrencies, such as Bitcoin and Litecoin, are two very popular types of digital currencies that have drastically changed the way people view money. In this article, we will discuss and demystify the distinction between these two highly sought-after cryptocurrencies to help you understand better what sets them apart from one another and how they can be applied in different situations.
What is Bitcoin?
- Bitcoin is a revolutionary digital form of currency that has been gaining wide acceptance in recent years. Bitcoin is borderless and decentralized, meaning it’s not under the control of any government or banking institution.
- Bitcoin works by using a shared ledger system known as the blockchain, which allows individual Bitcoin users to securely transfer Bitcoin from one user to another with little to no transaction fees.
- Bitcoin is growing in popularity as people are drawn to its fast transaction speeds, low-cost transfers, and complete anonymity for Bitcoin users. For those looking for an alternative to traditional currency systems, Bitcoin provides an opportunity for greater financial autonomy.
What is Litecoin?
- Litecoin is a decentralized virtual currency based on blockchain technology. As an open-source platform, Litecoin allows users to send and receive funds in a secure and cost-effective manner.
- Litecoin has been around since 2011 and since then, it has become one of the most popular digital currencies available today. Litecoin is designed to be faster than Bitcoin and with lower transaction fees.
- The Litecoin network also enables quick confirmations which makes it an attractive option for day-to-day payments. Litecoin can be stored in wallets that are secure, easy to use, and reliable, making them a great choice for those looking to bank digitally.
Difference between Bitcoin and Litecoin
Bitcoin and Litecoin are both popular digital currencies with similar features, but they also have many differences. Bitcoin is the original cryptocurrency, while Litecoin was created as a spin-off of Bitcoin.
- Bitcoin transactions take roughly 10 minutes to be confirmed, while Litecoin transactions are much faster and can be approved in 2.5 minutes or less.
- Additionally, Bitcoin has an overall block size limit that is four times larger than Litecoin’s limit and it was built on a proof-of-work consensus mechanism of mining, compared to the proof-of-stake consensus of Litecoin.
- This means different hardware is needed for mining Bitcoin compared to mining Litecoin. Bitcoin also offers a higher amount of privacy than Litecoin since individual Bitcoin wallet addresses are not shared publically unlike those of Litecoin addresses.
Despite these differences, Bitcoin and Litecoin do share some similarities such as their algorithms and maximum amounts of coins available, where each currency has a limited supply cap at 21 million coins for Bitcoin and 84 million coins for Litecoin.
Conclusion
Bitcoin and Litecoin are two of the most popular cryptocurrencies in the world. Both offer a number of advantages over traditional currency, but there are some key differences between the two. In this article, we’ve outlined those differences for you and provided some insight into which one might be right for you.
