Given the number of cryptocurrencies now available, it can be challenging to know what the differences are, including any potential strengths and weaknesses. When Litecoin was developed, it was envisioned as being the “silver” to Bitcoin’s ‘gold.” This makes them something of a standout among other virtual currencies.

Although the value of different cryptocurrencies may vary, in general, Bitcoin has been the most highly valued form of virtual currency. However, Litecoin, Ethereum, Ripple, and others are beginning to make up ground.

A key difference between Bitcoin and Litecoin has to do with the total number of coins which each type of cryptocurrency is capable of producing. The Bitcoin network cannot exceed 21 million coins, but Litecoin can reach up to 84 million coins. While this might seem to favor Litecoin, both their currency and Bitcoin’s value can be divided into extremely small amounts. But for some users who prefer completing transactions in whole units rather than fractions of a unit, Litecoin may be a more appealing choice. To counter this, many Bitcoin wallets like Electrum and Multibit offer users the option of seeing the value of their bitcoins in comparison of official (fiat) currencies like the U.S. dollar, which may remove Litecoin’s advantage in this regard.

Another way in which Bitcoin and Litecoin are dissimilar has to do with the speed at which each network processes transactions. While in technical terms, transactions occur immediately on both the Bitcoin and Litecoin networks, for Bitcoin, the average time for a transaction to be confirmed is a little over 10 minutes while Litecoin only takes 2.5 minutes. This may make Litecoin seem like a better option for merchants as it takes almost four times as long for a Bitcoin transaction to be completed as one with Litecoin.

The biggest technical difference between Bitcoin and Litecoin lies in the different cryptographic algorithms which they use. Bitcoin utilizes the SHA-256 algorithm, and Litecoin employs Scrypt. These different scripts are notable because of the way they impact the process the mining of new coins. Both Litecoin and Bitcoin require a great deal of computing power to confirm transactions. SHA-256 is considered to be more complex than Scrypt, but at the same time it allows for more parallel processing. This means Bitcoin miners are now able to use more advanced methods of mining coins. But this also means that Bitcoin mining is difficult for ordinary users.

In contrast, Scrypt was designed so that it isn’t as easily tailored to such specialized hardware solutions as that of ASIC-based mining, which makes those cryptocurrencies based on Scrypt more accessible to users who want to both mine and purchase currency. But given companies such as Flower Technology and Zeus making Scrypt ASICs available, Litecoin may no longer be able to offer such readily accessible mining.

When taken as a whole, the differences between these two types of cryptocurrencies may be significant, but this is a space which is undergoing significant innovation in very short spans of time. One of them may prove to be more successful based on technology that has yet to be introduced, or other factors might be what makes a single currency the ‘crypto of choice’ for the largest number of users.

BLMP ©2018, Singapore

BLMP (Blockchain Licensing Marketplace) is a blockchain technology company working to remove obstacles and facilitate trust in the complex issues surrounding supply chain management transactions in the virtual goods industry.

BLMP Network uses blockchain technology to connect digital platforms around the world with global brands to monetize officially licensed virtual goods across any digital platform; from games to streaming services & social media, allowing millions of users access to a whole new world of branded virtual products.

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