Litecoin appears in the list of leading altcoins that arrived in the cryptocurrency marketplace subsequent to bitcoin. Undeniably, the most successful altcoins based upon market value and market cap is ether, but litecoin came way early than ether and has still sustained its credibility. Visit https://bitiq.org/ to get a deep analysis of bitcoin trading. Litecoin might not be the most fast-growing altcoin, but when it comes to the best alternative to bitcoin, litecoin manages to top the table.
Despite being structured on the same technology as bitcoin, litecoin is way more scalable than bitcoin. The mere difference between litecoin and bitcoin technology is the hashing algorithm. As litecoin uses the script hashing algorithm, on the other hand, bitcoin utilizes a famous hashing algorithm named securing hashing algorithm 256.
This hashing algorithm falls under the category of one-way hashing function accounting as the primary factor behind the immutability of the blockchain. The developer of litecoin derived this cryptocurrency from the source code of bitcoin.
Inits early stages, litecoin was a mere competitor of bitcoin. Still, after a massive entry of new contenders in the cryptocurrency community, litecoin is not popular as it used to be. The market cap of this digital currency the previous year was $15 billion. Nevertheless, Litecoin still appears in the top 10 digital currencies this year. Here is a list of several differences between litecoin and bitcoin.
Key takeaways!
- Litecoin is one of the few early arrivals in the cryptocurrency community after bitcoin.
- Litecoin might be the first digital currency derived from the authentic source code of bitcoin. When people used to refer to bitcoin as virtual gold, they used to refer to litecoin as a virtual silver. Litecoin appeared at the third spot before other altcoins’ arrival in terms of market capitalization.
- The structure of bitcoin and litecoin is similar; however, the hashing algorithm of litecoin, alongside its blockchain block size, creates massive differences in the scalability of these coins.
Acknowledging litecoin!
Like other decentralized currencies, litecoin is equipped with a cryptographic framework that makes it safe for international and domestic transactions. However, government authorities have power when it comes to the issuance of litecoin. Moreover, the supply and demand of litecoin cannot be regulated by the government authorities of any region. The developer of this cryptocurrency is a former Google engineer named Charlie Lee.
Charlie lee was heavily inspired by the notion of bitcoin and derived this cryptocurrency from bitcoin’s open-source code. In addition, Charlie Lee introduced some massive changes in the technology of litecoin, making it more scalable. Bitcoin lags behind litecoin in terms of scalability as BTC can execute merely a few transactions per second, and sometimes it takes several minutes to execute a bitcoin transaction.
Similar to a definite number of BTC, the definite number of LTC is there are miners are allowed to create the definite number of this cryptocurrency with the help of personal computers and GPU mining rigs. Charlie Lee created the structure of this cryptocurrency in such a way that miners will only have to use individual CPUs for mining. But nowadays, CPU mining of litecoin is unprofitable, and they have to use graphic processing units. The bitcoin network consumes 10 minutes to generate a block; the litecoin network consumes only 2.5 minutes.
And this is one of the prominent reasons behind skyrocketing scalability of the litecoin network. Moreover, the block reward of mining a block in the litecoin network is almost double as of the bitcoin network. But miners will be mining the last litecoin in 2142, whereas bitcoin miners will mint the last bitcoin in 2140.
A combination of proof of work and script!
As discussed above, litecoin utilizes a similar consensus mechanism as bitcoin that is proof of work, making cryptocurrency mining exceedingly competitive. But, this digital currency utilizes a script hashing algorithm. Scrypt is a different hashing algorithm from the securing hash algorithm 256, as scrypt is structured on a password derivate mechanism.
The founder of the scrypt hashing algorithm is also Charlie lee. It is not merely used in the litecoin network, as other cryptocurrencies like Dogecoin correspondingly use a similar hashing algorithm. However, when it comes to comparing litecoin and bitcoin in terms of market value, bitcoin is way ahead of this altcoin.
The above portion describes everything about litecoin and bitcoin.