When someone gets involved in the cryptocurrency scene, it is very easy to get caught up in the hype and whirlwind world of bitcoin – the best, the biggest, the original. It is understandable, of course – why would we even bother with something else when bitcoin seems to be the pinnacle of cryptocurrencies?
But there are other coins, many, many more, and it increasingly seems like that all those who disregard the so-called altcoins are the people and businesses who are going to be disregarded later.
Litecoin is one of the many underrated cryptocurrencies that not only provide amazing investment options but it is also great for those who are only familiar with bitcoin. After all, it is not without reason that a lot of people refer to litecoin as the silver to bitcoin’s gold – and if you stick with us, we will show you just how true that is.
How did litecoin start?
Before we jump into any technical talk or any comparisons to bitcoin, let’s look at a little history lesson. No, not the Romans and not even the French Revolution – the history of litecoin that started much earlier than a lot of people would think it did.
Litecoin was founded in 2011, just a mere two years after the official bitcoin launch and many years before its main competitors were born that have only been up and running for a couple years. Unlike Bitcoin with its mysterious founder, Satoshi, litecoin’s founding story is a little less romantic – it was simply created by a guy who was a great computer scientist.
And yes, this great computer scientist does, indeed, have a name. Charlie Lee is an Ivory Coast native who immigrated to the US with his parents at an early age and graduated from MIT (though that was a couple years later). Then he went on to work with Google and worked on many interesting projects. But none of those projects could come near to his own that finally came to fruition in the September of 2011 – and what project could that be?
Fairbix and its impact
If you guessed litecoin, then we are incredibly sorry to inform you, that you are wrong. The first cryptocurrency that Lee launched back in September 2011 was Fairbix, a crypto that was heavily influenced by not only bitcoin but Tenebrix, another coin that came out just a couple month prior.
But that first cryptocurrency had its fair share of issues and was quickly doomed to fail. Worry not, Lee quickly stood up from his disappointment and created his second cryptocurrency – the long-anticipated litecoin. And looking at the algorithm Lee used, we should definitely give a lot of credit to Fairbix even if at the end, it failed – Litecoin heavily relied on the successful parts of that early crypto and that should not be overlooked.
With all this being said, we still haven’t really talked about one tiny detail here – what exactly is litecoin?
Litecoin (LTC), just as Bitcoin, is a peer-to-peer (P2P) cryptocurrency operating on an open-source, cryptographic protocol. To be completely honest, just looking at the technical details of the two cryptos, we can hardly see any differences.
However, this technical similarity does not mean that there are no differences between the two – on the contrary, this similar background makes the differences in usage and other areas stand out that much more.
Major differences between BTC and LTC
One of the major differences that most experts like to talk about lies within the issue of block times. In case of bitcoin, creating one block usually takes just over 10 minutes – which can lead to increased confirmation times and is actually one of the major issues that people have with bitcoin today. Litecoin is very different in this regard. Here a block is usually processed in 2.5 minutes, which is a significantly shorter period of time than what bitcoin requires to complete one block. This shorter confirmation time is something that can be very attractive to investors and merchants and is something that litecoin’s marketing can heavily rely on.
Another big difference between the two cryptos is that litecoin uses an algorithm, called Scrypt, which is much more memory-hard than what bitcoin uses. This creates a big difference for the miners and the companies producing mining devices as the two algorithms require completely different things.
But Charlie Lee himself also was not setting out to simply create a bitcoin knock-off – no, his vision was something else. The way he looks at litecoin is not as a competitor of bitcoin but as an alternative that is used for very different things than bitcoin should be.
According to Lee, litecoin is better equipped to carry out smaller transactions with, for example online purchases. On the other hand, bitcoin is working on a bigger scale, completing major international transfers and transactions. Just like silver is differently used than gold, litecoin is also not a replacement for bitcoin – but something that can live with the original cryptocurrency in a healthy symbiosis, making sure that both of them can live up to their full potential.
84 million vs. 21 million
One last difference that is also worth mentioning is the different coin supply sizes. While bitcoin’s maximum coin supply is famously capped at 21 million tokens, litecoin allows for a bigger limit: 84 million coins, to be completely precise.
However, if we really think about it, it doesn’t really make for that much of a difference. Yes, one litecoin is probably always going to be worth less than one bitcoin. But in the cryptocurrency world we’re already basically only dealing with fractions – it honestly hardly seems to matter just how many zeroes we actually have after the decimal.
All in all, we can definitely see that there are major differences between litecoin and bitcoin, although the altcoin is still very close to the original idea of bitcoin – probably even closer than the other altcoins are.
But it would definitely seem foolish to simply disregard litecoin as a lesser cryptocurrency – not only because over the past 8 years it has definitely proven its worth but also because the future seems very bright for this altcoin.
Gold is just not the same without its silver – bitcoin and litecoin are no exception.