What is the difference between Bitcoin and Litecoin?
While we don’t know who Satoshi Nakamoto, the creator of Bitcoin is, we do know Charlie Lee, the creator of Litecoin.
Litecoin vs. Bitcoin
|Creator||Satoshi Nakamoto||Charlie Lee|
|Coin supply||21 million||84 million|
|Block rewards halved||every 210,000 blocks||every 840,000 blocks|
|Average transaction time||10 minutes||2.5 minutes|
One of the primary differences between the two cryptocurrencies is that Litecoin takes 2.5 minutes to generate a block of transactions, as opposed to Bitcoins 10 minutes. This means that Litecoin can confirm transactions roughly four times faster than Bitcoin. This difference in transaction time could make Litecoin more attractive to merchants, which is why Litecoin is often regarded as a currency for day-to-day transactions while Bitcoin is currently considered more of a store of value. This is possible because home-use computers can be used for Litecoin mining, whereas Bitcoin requires a specific customised computer.
Another significant fundamental way Litecoin differs from Bitcoin is its mining algorithm. While both are proof of work, Bitcoin uses the traditional SHA-256 hashing algorithm. Litecoin uses a comparatively new algorithm known as Scrypt. Another key difference between the two is that Scrypt requires less computing power, making it possible for regular users to participate in mining with less complexity.
Coin limit and block rewards
Both Bitcoin and Litecoin are ‘created’ as rewards to miners for verifying and processing transactions during the mining process. Both also have a limited supply. The total limit for Bitcoin is 21 million, while Litecoin has a limit of 84 million. Once these limits are reached, no new coins will be created. These rewards are halved in order to limit the number of new coins released into the circulating supply to create scarcity. Bitcoin block rewards are halved every 210,000 blocks, while Litecoin block rewards are halved every 840,000 blocks.