Bitcoin and Litecoin have both seen good and bad throughout the years and at times, Litecoin has even been accused of being a competitor of Bitcoin. However, this could not be further from the truth, in fact, it is very much a compliment to the art and expertise that was actually put into the creation of Bitcoin. While it is simply a lite version of Bitcoin, they do have quite a lot of similarities and differences that set them apart.
In this article, we will go over some of the features and how they may differ between these two excellent forms of cryptocurrency. While Bitcoin originated in 2009 and is the dominant brand of the two, Litecoin was founded two years later and is one of its leading competitors still to this day. On the surface, it is fairly easy to see how much they actually have in common and this may be because they are both decentralized cryptocurrencies, however, there are certain things that set them apart. Litecoin and Bitcoin do have their differences, but let’s take a look at just how similar, or different, they may be.
Proof of work
The main similarity that people notice between Bitcoin and Litecoin is that they both readily harbour the exact same proof of work ecosystem. What this essentially means is that the underlying process used to mine both of these cryptocurrencies is fundamentally similar throughout it all. This includes the processes of generating, authenticating, and then adding it to a public ledger, or blockchain.
Storage and transactions
When you are looking at it through an investor’s eyes, it is fairly easy to think that many of the basic transaction elements are similar and through inexperienced eyes, they may be. They can both be easily bought via an exchange or you are able to mine them using a mining rig. Both Litecoin and Bitcoin require a digital or cold storage wallet in order to be safely stored between transactions.
The prices of the two are still very similar as well. Over time, they have both proven that they are heavily dramatic and extremely volatile forms of digital currency. This also depends upon a large range of factors as well that can range from investors to the interest in government regulations.
One main difference between Bitcoin and Litecoin exists here and it concerns the general number of coins that each individual cryptocurrency is able to produce. This is the point that Litecoin is able to distinguish itself from Bitcoin dramatically. Bitcoin itself is never able to exceed a limit of 21 million coins which makes it a finite cryptocurrency, whereas Litecoin is able to accommodate a limit of up to 84 million coins with an option to extend that limit.
While this may sound like one could have a significant advantage over the other as time goes by, the real-world effects on both cryptocurrencies are what will essentially define how they will exist in the future. Even programs such as Algo Affiliates will be able to make a big difference.