Litecoin vs. Ethereum
If you’re just getting started investing in cryptocurrency, you’ve more than likely heard of Litecoin (LTC) and Ethereum (ETH), two of the biggest blockchains in terms of market cap, value and influence.
While often compared, these two networks differ from a technical standpoint and in their respective use cases. However, comparing Litecoin and Ethereum is a great way to learn about the subtleties of different networks when it comes to crypto assets in general.
Let’s take a deeper dive into what differences the two offer.
LITECOIN
Litecoin was created as a digital currency alternative to Bitcoin and seeks to serve as an alternative to traditional government currencies.
ETHEREUM
Ethereum was built to be a kind of operating system for any number of custom assets and programs.
To further understand how these two complex networks work, read below for a side-by-side comparison of Litecoin vs Ethereum so you can start to better understand and appreciate the differences yourself.
The difference between Litecoin and Ethereum
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.
Ethereum
Ethereum was created with the intention of becoming a global, open-source platform for custom assets and new kinds of economic applications.
Considered to be one of the most ambitious blockchain projects to date, Ethereum seeks to leverage blockchain technology to decentralize products and services in a wide range of use cases beyond money.
To date, Ethereum has seen a few distinct phases that have emphasized different aspects of its capabilities.
First, entrepreneurs flocked to Ethereum in 2017 during its famous “ICO boom”, where creators would try to raise money for new projects using new assets on the Ethereum blockchain.During this time, Ethereum was seen as something of a global capital allocator and funding mechanism.
A new phase of Ethereum, called decentralized finance (DeFi), has started garnering attention in 2020. This movement saw the creation of decentralized applications (dapps) intended to automate financial services like lending or borrowing without the need for a traditional bank or intermediary.
Useful resources
If you are interested in learning more about Litecoin and Ethereum, please visit Kraken’s What is Litecoin? and What is Ethereum? pages.
If you want to learn more about the consensus mechanisms that power each blockchain, then the Proof of Work vs. Proof of Stake page is where you want to go!
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.