If you ever traded in cryptocurrency, you probably have already heard about Litecoin. This revolutionary cryptocurrency, although not the first of its kind, has seen a great surge in popularity in recent years. Today, Litecoin has a market cap of over 9 billion dollar, placing it as the top 6 in terms of market cap amongst cryptocurrencies. With such great success, many have wondered whether Litecoin is better than Bitcoin.
Bitcoin vs Litecoin
Round One:
- Transactions
Firstly, Bitcoin transactions take longer to be confirmed by the blockchain. According to data from Blockchain.info, the Bitcoin network’s long-term average transaction confirmation time is just over 10 minutes per transaction. The equivalent figure for Litecoin is roughly 2.5 minutes, according to data from BitInfoCharts.com. In principle, this difference in confirmation time could make Litecoin more attractive for merchants. For example, a merchant selling a product in exchange for Bitcoin would need to wait nearly four times as long to confirm payment as if that same product were sold in exchange for Litecoin. On the other hand, merchants can always opt to accept transactions without waiting for any confirmation at all. The security of such zero-confirmation transactions is the subject of some debate. However, recent innovations such as Bitpay’s proposed Inter-Channel Payments system (nicknamed “Impulse”) may make these kinds of instantaneous transactions significantly more secure, mitigating Litecoin’s faster confirmation time advantage.
Round 2:
- The amount of coins that can be issued
Besides that, the total amount of coin that can be issued/mined by Bitcoin and Litecoin also vary. The Bitcoin network can never exceed 21 million coins, whereas Litecoin can accommodate up to 84 million coins. Although in theory this sounds like a significant advantage in favor of Litecoin, its real-world effects may be negligible. This is due to the fact that both Bitcoin and Litecoin are divisible into nearly infinitesimal amounts. In fact, the minimum quantity of transferable bitcoin is one hundred millionth of a bitcoin (0.00000001 bitcoins) known colloquially as one “satoshi.” Users of either currency should therefore have no difficulty purchasing low-priced goods or services, regardless of how high the general price of an undivided single bitcoin or litecoin may become.
Despite this, Litecoin’s greater number of maximum coins might offer a psychological advantage over Bitcoin, due to its (so far) smaller price for a single unit. In a video interview posted by IBM’s banking division in November 2013, IBM executive Richard Brown raised the prospect that some users may prefer transacting in whole units rather than in fractions of a unit—a potential advantage for Litecoin.Yet even assuming that this is true, this problem may be solved through simple software changes introduced at the level of the digital wallets through which Bitcoin transactions are made. As Tristan Winters points out in a November 2013 Bitcoin Magazine article, “The Psychology of Decimals,” popular Bitcoin wallets such as Multibit and Electrum already offer users the option of displaying the value of their bitcoins in terms of official (or fiat) currencies such as the U.S. dollar. This can help circumvent the psychological aversion to dealing in fractions when using bitcoin.
Round 3:
3)Transaction Cost
Although Bitcoin is more popular than Litecoin, Litecoin is the preferred method of transferring wealth. In fact, Litecoin is catching up to Bitcoin in terms of daily transactions. This is because Bitcoin transactions take longer to be confirmed on the Blockchain compared to Litecoin, causing it to be more expensive mining fees and slower transactions. Litecoin is built to be more efficient than Bitcoin, partly through virtue of being a newer and more optimized cryptocurrency.
Conclusion:
Although most people will tell you that one cryptocurrency is better than the other, both Litecoin and Bitcoin has its advantages. Most importantly, the deciding factor on this topic is your budget and your motive.
If you want to buy in to the most proven cryptocurrency with the most developer support, Bitcoin is the better of the two currencies. It’s the most expensive out there though and its transaction fees are high, so if you want a big return on what you’re putting into it, you’ll need to have plenty to spend and be patient. Bitcoin has repeatedly swung upwards and downwards in value in recent weeks, and its historic crashes can be devastating for those with big money invested. But as the die-hard fans often say, just “hold.”
If you plan to make more regular transactions, to pay for goods or services, or send cryptocurrency to a loved one, Litecoin is much more manageable. With less of a scaling problem, its blockchain is far more open and you’ll see your currency confirmed far faster. You’ll be charged much less for the privilege too. It’s not perfect, but it’s far better than Litecoin in that aspect.
This is still a young venture and the future of any and all of them is far from certain
