Litecoin vs. Bitcoin
Litecoin (LTC) and Bitcoin (BTC), two of the more popular cryptocurrencies in terms of value and influence, are often compared to one another.
In fact, Litecoin has been referred to as “silver to Bitcoin’s gold”, a tagline that often entices potential buyers. On the surface, the two cryptocurrencies offer similar value as alternatives to traditional money.
Let’s take a deeper dive into the difference between Bitcoin and Litecoin.
LITECOIN
Litecoin copied and modified Bitcoin’s code with the aim to finalize transactions faster and to pioneer new features before they go live on Bitcoin.
While this may be an oversimplification of how these two complex networks work, the goal of this article is to give you a side-by-side comparison of Litecoin vs Bitcoin so you can start to better understand and appreciate the differences yourself.
The difference between Litecoin and Bitcoin
DATE FOUNDED
Litecoin
October 7th, 2011
Bitcoin
The Bitcoin white paper was published on October 31, 2008 on the cryptography mailing list. The software later went live on January 9, 2009.
CREATOR
Litecoin
Charlie Lee
Bitcoin
Bitcoin was created by a pseudonymous individual or group under the name Satoshi Nakamoto. To this day, Bitcoin’s creator remains unknown.
TICKER
Litecoin
LTC
Bitcoin
BTC (Note: You may see BTC appear as XBT on other platforms)
VISION
Litecoin
Litecoin was created with the intention to attract merchants who were looking for a quicker way to process transactions.
To achieve this, Litecoin copied the Bitcoin code and modified it by reducing the amount of time it took for new blocks of transactions to be added to the blockchain.
As interest from merchants in cryptocurrency faded, however, Litecoin would adopt a more aggressive approach to development, pioneering new features like the Lightning Network and Segregated Witness, cutting-edge technologies now live on Bitcoin.
As such, the project differs from many other cryptocurrencies in that it has always been positioned as a complement to Bitcoin by serving as a sort of a testnet for new Bitcoin features.
Bitcoin
Bitcoin is an open-source software that allows its global user base to manage a digital money supply outside the control of any government or central bank.
It was created in response to the 2008 global economic crisis as a means to combat inflation. In fact, the first mined block contained the message: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks,” a message many believe signifies the project’s revolutionary intent.
The Bitcoin software enables the computers running it to manage a ledger (the blockchain) that accounts for all transactions made using its currency (BTC) by enforcing a variety of rules.
The Bitcoin blockchain is a full record of the network’s transaction history validated by nodes, or individuals running its software. This ensures that each BTC cannot be copied or modified, and that bitcoins cannot be created or used in a way that is against its rules.
Bitcoins are scarce, divisible and transferable, making them a valuable alternative money.
LAUNCH & ISSUANCE
Litecoin
Litecoin was launched and created in 2011 and has since been closely associated with its founder, Charlie Lee, a computer scientist who previously worked for Google.
In an attempt to help people “own bitcoin and hold bitcoin,” Lee put development of Litecoin aside and joined a cryptocurrency exchange as Director of Engineering from 2013-2017.
In late 2017, Lee departed the crypto exchange to pursue Litecoin development full time. Lee now serves as the managing director of the Litecoin Foundation, a non-profit dedicated to the project.
Bitcoin
Bitcoin’s white paper, titled “Bitcoin: A Peer-to-Peer Electronic Cash System” , was released by Satoshi Nakamoto in 2008.
The first 50 bitcoins were mined upon the release of the software, enabling a decentralized network of computers to run a digital economy that is still thriving today.
Satoshi famously left the project in 2011 and hasn’t been heard of since, though you can find out more about his (or her) attitudes toward the technology in various emails and forum posts.
Since then, hundreds of developers have contributed to improving Bitcoin’s code, whether it is routine bug fixes or great, efficiency driven, improvements.
NETWORK DESIGN
Litecoin
Wanting to create an alternative to payment systems like Visa and PayPal, Litecoin has prioritized design choices aiming to make its transactions cheaper and faster.
Litecoin keeps its network secure and decentralized, while regulating the supply of new money that gets released into its economy using Proof of Work (PoW) mining where miners race to complete cryptographic puzzles to propose blocks that make up the Litecoin blockchain.
Litecoin differs from bitcoin in that blocks are added to its blockchain roughly every 2.5 minutes (as opposed to 10 minutes on Bitcoin).
Further, the mining software required can be used with computer-grade hardware .Today, it is still possible to mine LTC with hobbyist equipment, though its market is dominated by large-scale miners.
Bitcoin
Central to Bitcoin’s design is the ability for two users to send each other BTC from anywhere around the world, without the need for an intermediary.
In order to keep its network secure and decentralized, while regulating the supply of new money that gets released into its economy, Bitcoin uses a process called “mining”.
In this system, called Proof of Work (PoW), miners race to complete cryptographic puzzles to propose blocks that make up the Bitcoin blockchain.
When a block is discovered by a miner, it is announced to the network, and, when it’s verified by every node, the miner gets compensated in newly minted BTC.
MONETARY POLICY
Litecoin
Litecoin’s cryptocurrency, LTC, has a limited maximum supply, meaning that according to the software’s rules there will only ever be 84 million LTC.
Similar to Bitcoin, 50 LTC were released when the first block was mined in 2011 and the block reward gets halved roughly every four years.
Through this process, more than 66 million LTC have been made available as of 2020. The last LTC is projected to be mined in 2142.
Bitcoin
One of the biggest value propositions of Bitcoin is its monetary policy – only 21 million BTC will ever be introduced into the network’s economy.
When the first block was mined in 2009, 50 BTC were released, a block reward that is cut in half roughly every four years. This event is known as the halving, or halvening.
Through this process, more than 18 million BTC have been made available as of 2020. The last bitcoin is projected to be mined in 2140.
Useful resources
If you are interested in learning more about Bitcoin and Litecoin, please visit Kraken’s What is Bitcoin? and What is Litecoin? pages.
Want more in depth information on specific cryptocurrencies and blockchain projects? If so, visit our Learn Center to further your education on this ever-growing space.