What are the differences between litecoin and bitcoin?

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Mansoor Ahmed Selected

Mansoor Ahmed

11 months ago
While there are many similarities between bitcoin and litecoin, some of the subtle differences include:

TRANSACTION SPEED
While litecoin requires more sophisticated technology to mine than bitcoin, blocks are actually generated up to four times faster. Litecoin also processes financial transactions a lot quicker, and can also process a higher number of them over the same time period.

NUMBER OF COINS
Both bitcoin and litecoin have a finite number of coins in circulation. Bitcoin has 21 million coins available, while litecoin has 84 million available – four times more than bitcoin.

MARKET CAP
Litecoin has a much smaller market cap than bitcoin, but is still one of the most traded cryptocurrencies.

ALGORITHMS
Miners must successfully solve hash functions in order to add new blocks of a cryptocurrency to the blockchain. Litecoin and bitcoin use different mining algorithms, with Scrypt being the hash function used for litecoin, and SHA-256 the hash function used for bitcoin. Scrypt was initially chosen by the litecoin development team to avoid mining being dominated by ASIC-based miners. This would allow CPU and GPU-based miners to compete. The Scrypt mining algorithm is more memory intensive, and this was initially less suited to ASIC miners, giving other miners more opportunity. However, Scrypt-capable ASIC-based miners have developed over time. This means CPU and GPU-based miners no longer have valid mining tools due to the inferior computational powers, and ASICs are able to generate far more hashes per second.