If you are familiar with the world of blockchains and cryptocurrencies, chances are that you must have come across Litecoin. The altcoin is often considered Bitcoin silver as it is closely related to the number one cryptocurrency, Bitcoin. Created in 2011 as a peer-to-peer cryptocurrency, Litecoin is now one of the top cryptos in the market.
Both Bitcoin and Litecoin are successful and attract similar users. For a couple of years, Litecoin has strongly competed with Bitcoin, making more investors and traders more interested in the coin. Presently, the coin is the 7th largest digital currency, with most people regarding it as a better version of Bitcoin.
But could this be true? Well, Litecoin has some unique features that give it a good advantage to outperform BTC over the longer run. In this post, we will be looking at some of the reasons Litecoin could be a better version of Bitcoin.
History of Bitcoin vs. Litecoin
Created in 2008, Bitcoin was the first-ever cryptocurrency that made it into the free market. It promised a future that would be independent of government and bank regulations. Bitcoin provides a space where people can send money to each other at any time quickly and safely without the need for any middleman like banks and other financial institutions.
In February 2011, 1BTC was worth $1, but by June, the price rose to $31 and continue to rise to a few hundred dollars in the later years. Today, Bitcoin is not only the most popular cryptocurrency but also has the highest recovery rates as it surpasses each of its previous recovery records.
However, in 2011, Charlie Lee, then a Google employee, decided to change some of Bitcoin’s rules to create a faster and cheaper version of the coin. His ideas caused a disagreement between Bitcoin users, leading to the November 2011 BTC hard fork that created Litecoin.
Two years later, all the Litecoin in the world was worth $1 billion. Just like Bitcoin, the altcoin has also grown in popularity and acceptance. So, the debate to determine which is better was born to help traders and investors make a choice between the two. Let see some reasons Litecoin may soon outrun Bitcoin.
Reasons Litecoin Could Be a Better Version of Bitcoin
#1: Charlie Lee is fully dedicated to Litecoin
Charlie Lee, who created the Litecoin project in 2011 while working at Alphabet subsidiary Google, had been working at Coinbase for some years now – until recently. Charlie dropped his day job to work full-time on promoting Litecoin. He has declared his plans to go after merchants and exchanges in the bid to bring Litecoin into the mainstream.
This could be a better advantage of Litecoin over Bitcoin as the coin has a physical founder that is heavily involved in its growth.
#2: Litecoin implements the SegWit upgrade
The completion of the Segregated Witness (SegWit) blockchain upgrade in May was a big move for Litecoin and one of the reasons Charlie Lee decided to leave his job at Coinbase. Beating Bitcoin to the punch, this new Litecoin’s SegWit upgrade helps boosts the capacity of its blockchain while speeding up transactions and lowering transaction fees.
Transaction fees or settlement times have always been a major complaint with Bitcoin’s blockchain. But now, with the SegWit upgrade, Litecoin seems to be having an advantage.
#3: Quicker block generation
This is another major way Litecoin has improved over Bitcoin. It offers a quicker block generation time. Compared to Bitcoin’s 10 minutes, Litecoin has a time of 2.5 minutes. That means transactions involving Litecoin will be confirmed four times faster than those with Bitcoin.
In practical terms, Litecoin could be a more useful medium of exchange, particularly for small transactions. This is because the fees will likely be substantially lower than those for Bitcoin. That also means investors will spend less money paying to buy or sell Litecoin too.
#4: A more centralized proof-of-work algorithm
The mining algorithm of LItecoin also offers some advantages over that of Bitcoin. Though both of them use Proof-of-work, Bitcoin uses the traditional SHA-256 hashing algorithm while Litecoin uses the comparatively new algorithm known as Scrypt.
The major difference between the two is that Scrypt requires less computing power, making it possible for more regular users to participate in mining with less complexity.
#5: Mining is easier with Litecoin
Because of Litecoin’s Scrypt proof-of-work algorithm, it makes mining much simpler than that of Bitcoin. Litecoin mining can be done on computers that are less powerful and also requires less energy. Considering that mining operations around the world are taking up massive amounts of electricity, and there is already a shortage of power graphics cards needed for mining rigs, this could come as a great advantage to Litecoin miners in the years to come.
#6: Coin limit and block rewards
Both Bitcoin and Litecoin are given as rewards for miners processing and verifying transactions during the mining process. Both of them also have a limited supply. While the total limit of Litecoin is 84 million, Bitcoin only has a limit of 21 million. Once these limits are reached, there will be no more coins to be created.
In order to limit the number of coins released into circulation, these rewards given to miners are halved at some points. For Bitcoin, the rewards are halved after every 210,000 blocks have been generated, and Litecoin block rewards are halved after every 840,000 blocks.
#7: The rule of large numbers
There is always the rule of large numbers at work in the cryptocurrency market, and in this case, that might be working in favor of Litecoin. Psychologically, it will be much easier for Litecoin and its $17.4 billion market cap to double in size to about $35 billion than it will be for Bitcoin to double in size from $281 billion to $562 billion. Investors are actively looking for “the next Bitcoin,” and Litecoin might be the thing for many of them.
Final Note
These are great advantages Litecoin is presently having over Bitcoin, which could make the altcoin the next big thing over Bitcoin. If anyone is looking for the next “gold” in the crypto market to invest in, looking in the direction of Litecoin will be a good move. You can buy your Litecoin now so you won’t be left out in the cold when Litecoin finally picks over Bitcoin.
Litecoin is presently working at its best to solve the world’s transaction need; you shouldn’t be left out of the new future!
