The miner that successfully answers the equation is rewarded with the mining reward and gets to officially add the next block of transactions to the blockchain. Notably, these mining rewards are the only time that new BTC enters the market.
They are designed to occur every ten minutes. The more hashing power of the network, the more difficult the answer. To increase the difficulty, the equation simply requires more zeros in the answer. The original Bitcoin mining reward was 50 BTC. These rewards decrease in half around every four years. The current Litecoin mining reward is Like Bitcoin, Litecoin is designed to halve mining rewards approximately every four years.
Litecoin uses a PoW algorithm as well. Scrypt was built specifically to make it costly to perform large-scale custom hardware attacks. In addition, Litecoin incorporates a slightly modified GUI. These changes made it a bit more complicated to create and more expensive to produce Litecoin mining rigs in the early days of cryptocurrencies. Bitcoin and Litecoin share many technical aspects. For example, both coins utilize Segregated Witness SegWit. SegWit allows the network to split transactions into two segments.
This information is then re-added as a separate structure at the end of the transaction. Litecoin beat BTC to the punch on this upgrade. Litecoin miners updated to SegWit capabilities in May This would not be the last time that Litecoin beat Bitcoin to the technical punch. Litecoin was also the first network to successfully integrate the Lightning Network. This second-layer protocol introduced the use of private payment channels to reduce blockchain congestion. Notably, the first Lightning Network transaction transferred 0.
The transfer took less than one second to complete. Over the last decade, Litecoin and Bitcoin have seen a continued decoupling of value. Litecoin users have shown completely different trading and spending habits compared to Bitcoiners. However, it must be noted that Bitcoin has proven to be a better, or at least more popular, store of value versus Litecoin.
Litecoin vs. Bitcoin: Which Is the Best Cryptocurrency Investment for New Buyers?
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How Litecoin Is Different
Your Money. Personal Finance. Your Practice. Popular Courses. Part Of. Bitcoin Basics.
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Bitcoin Exchanges. Bitcoin Advantages and Disadvantages. Bitcoin vs. Other Cryptocurrencies. Bitcoin Value and Price. Cryptocurrency Bitcoin. Table of Contents Expand. Litecoin: An Overview. Similarities Between Bitcoin and Litecoin. Differences Between Bitcoin and Litecoin. Litecoin vs. Bitcoin FAQs. Litecoin: An Overview Over the past several years, public interest in cryptocurrencies has fluctuated dramatically. Key Takeaways Both Bitcoin and Litecoin are cryptocurrencies.
Bitcoin, which originated in , is the dominant brand; Litecoin, founded two years later, is one of its leading competitors. Bitcoin and Litecoin use fundamentally different cryptographic algorithms: Bitcoin uses the longstanding SHA algorithm, and Litecoin uses a newer algorithm called Scrypt. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate.
You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. Compare Accounts. The offers that appear in this table are from partnerships from which Investopedia receives compensation. Related Articles. Cryptocurrency What Is Dash Cryptocurrency? Bitcoin Top Bitcoin Myths Debunked. Partner Links. Launched in the year , Litecoin is an alternative cryptocurrency based on the model of Bitcoin.
Bitcoin Bitcoin is a digital or virtual currency created in that uses peer-to-peer technology to facilitate instant payments. It follows the ideas set out in a whitepaper by the mysterious Satoshi Nakamoto, whose true identity has yet to be verified. Bitcoin started its life relatively worthless and very difficult to come by.
It was something that only early tech enthusiasts had access to, through mining or through a connection with someone who was mining. For example, Bitcoin first was traded for pizza at a rate of 10, for two pizzas with toppings making it the first transaction. Later, it became the currency of choice for the dark web marketplace Silk Road due to the anonymity it provides.
5 Reasons Litecoin Is a Better Choice Than Bitcoin | The Motley Fool
It also helped create an entire crypto market, filled with altcoins like Litecoin that try to beat Bitcoin at its own game but ultimately have failed to do so. Instead, these altcoins live side-by-side with Bitcoin in harmony, and each has its own pros and cons.
They both act as payment currencies, albeit Litecoin is faster. Litecoin is cheaper per coin than Bitcoin, which helped create silver and gold nicknames and the relationship between the two crypto assets. Bitcoin was the first of its kind, so all it really had to do was work. Scaling, capacity, speed, and other issues would be addressed down the line, as more developers came onto the open source project and began creating second-layer technologies like Segregated Witness and Lightning Network.
But by default, Litecoin is faster than Bitcoin.
Bitcoin vs Litecoin: What’s the Difference?
Bitcoin transactions take roughly ten minutes per blockchain confirmation. The cryptocurrency can handle approximately transactions per second. Meanwhile, Litecoin generates blocks in 2. The cryptocurrency got its name due to being a more lite version of Bitcoin due to these attributes. Litecoin is often used to send crypto from one platform to another for this reason, and due to the low cost and speed associated with its transactions.
Both cryptocurrencies were extraordinarily early and are highly decentralized and widely distributed. Of course, there are plenty of whales that own both, just due to how crypto came to be. In addition, only so many coins are currently in circulation, making them even more rare than it would appear.
What Is Litecoin
Millions of coins are also presumed lost. Both also rely on the same block reward halving mechanism and proof of work consensus method to secure the network underlying network each token underpins. The biggest challenge Litecoin faces is the fact that Bitcoin and Litecoin currently target the same investors and traders. Ethereum, for example, has an entirely different use case, and developers build smart contracts and decentralized apps on top of it.
In contrast, both Bitcoin and Litecoin are used as payment currencies or a store of value. Bitcoin and Litecoin are called digital silver and gold. Like the cryptocurrencies referenced, both precious metals have limited supplies, are used as a store of value, and have been used as a currency over the ages. Few other assets have these attributes, making them unique as an investment or trading asset. Things could soon change for Litecoin, however, as Bitcoin gets much more expensive by the day, and Litecoin remains relatively affordable by comparison. Litecoin was also just added to PayPal alongside Bitcoin, Ethereum, and Bitcoin Cash, exposing the altcoin to million mainstream users of the payment service.