Litecoin vs Bitcoin: A Battle of Scale
Bitcoin’s stronghold over the world of digital currency is prominent enough to have earned it a subtle yet important delineation from other currencies. Usually when we consider a digital currency, we place it into one of two categories: ‘Bitcoin’ or ‘altcoin.’
Investors use the term ‘altcoin’ to describe any of Bitcoin’s contemporaries. This term alone is evidence of Bitcoin’s influence. Investors group everything created after Bitcoin, including well-known digital currencies Ethereum and Litecoin, together by the idea that they’re an ‘alternative’ to Bitcoin.
Despite this, digital currency exists in a relatively new market, and the market’s winners and losers have not yet been made clear.
What is clear, however, is that Bitcoin faces certain obstacles it needs to overcome in order for the currency to continue to sustain its grown, and Litecoin theoretically presents viable solutions to some of these obstacles.
What is Litecoin (LTC)?
Much like Bitcoin, Litecoin is a digital currency that is not under the direct of control of any governing body.
Through the use of blockchain technology, Litecoin is able to handle transactions without the need for intermediaries or outside interference. Further, all transactions are easily verified by examining the blockchain.
People can see the characteristics that differentiate Litecoin from Bitcoin in the currency’s title. Lee designed LTC to be a ‘lite’ alternative to Bitcoin’s storage requirements and processing times.
When a transaction is made with a decentralized digital currency, it has to be verified by the blockchain in order to be confirmed. This information is confirmed in blocks, and Bitcoin has an average block time of somewhere between 8 to 9 minutes (at the time of writing).
Litecoin, on the other hand, boasts a block time of slightly over 2 minutes (at the time of writing) making it able to confirm transactions quicker than Bitcoin.
Bitcoin’s scalability issue vs Litecoin
Bitcoin’s major internal issues concern how scalable the currency is. As the currency continues to grow in popularity, the issue is becoming increasingly prevalent.
Bitcoin has a ‘fixed’ block size of one megabyte. This was not an issue at the time of its creation. Since Bitcoin has surged in popularity, its block size now limits the currency. It can’t, for instance, carry out transactions in a quick time frame without high transaction fees.
Without a proper solution, Bitcoin’s transaction times and fees will continue to get worse.
One solution to these issues came in the form of a hard fork known as SegWit2x. Developers proposed the fork to increase the Bitcoin block size to two megabytes.
However, the hard fork was indefinitely suspended due to a ‘lack of consensus within the community,’ as the topic has been quite divisive.
In contrast, Litecoin was quick to implement SegWit, a potential fix for circumventing block size limitations. It also implemented various anti-spam measures alongside SegWit. Such measures have kept the currency’s transactions times much quicker than Bitcoin’s.
Litecoin vs Bitcoin
Bitcoin is currently the world’s most popular digital currency. As such, Litecoin cannot yet compare to the hundreds of thousands of Bitcoin transactions daily.
This means that, while Litecoin’s SegWit implementation and anti-spam measures have made the currency’s blockchain relatively small and allowed for fast transaction times, LTC has not yet had the opportunity to be tested on the same scale as Bitcoin.
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