Bitcoin vs. Litecoin: Four Key Differences

4 Mins read

Cryptocurrencies’ popularity has grown with time and led to an increase in investors’ interest in them. Bitcoin, launched a year before 2010, is the center of investor attraction among the currencies. Since the initiation of Bitcoin, many similar coins (altcoins) have been developed, and one of them is Litecoin

If you want to know the difference between Bitcoin vs. Litecoin, keep reading. This article will help you understand the difference between the two coins more simply.

Let’s roll on and get the finer details.

Bitcoin vs. Litecoin: An Overview

The attraction to crypto coins has risen with time due to people’s realization that they can conveniently invest in the currencies. Bitcoin is among the famous crypto coins in the market because it was the first currency of its type to be developed.

However, Bitcoin isn’t the only cryptocurrency, as many others have since entered the market. And gained remarkable progress. Litecoin is among the currencies contending with Bitcoin and is reasonably popular.

Before April 2021, Bitcoin had a market capitalization of 1 trillion USD, while Litecoin retained a market capitalization of 13.7 billion USD.

Bitcoin and Litecoin use two different algorithms. While Litecoin operates a more recent algorithm called Scrypt, Bitcoin utilizes the SHA-256 algorithm. 

Furthermore, Litecoin maintains a reasonable transaction speed and creates more coins than Bitcoin. In a bid to impress potential investors. 

While Bitcoin and Litecoin are founded on identical underlying blockchain and verification techniques, they have their main differences, which can enable you to make your cryptocurrency investment decisions.


In 2009 Bitcoin was initiated as the first cryptocurrency. Since then, it has gradually grown from newness to a contentious entity, an investment, and an exchangeable currency. It depends on decentralized and community computing strength to sustain the reality and security of a centralized database, known as a blockchain.

Some Bitcoin unique properties include:

Proof-of-work: The consensus instrument and validation procedure that utilizes the GPUs’ computational power. And to some extent, CPUs ascertain transactions and blocks within the blockchain.

Uses SHA-256: The cryptographic hash operation which encrypts the blockchain. The hash feature turns an input into a fixed-length output to encrypt it. 


In 2011 Litecoin was launched by Charlie Lee, an ex-Google engineer. Who made public the debut of the “Bitcoins lite version” through a message posted on a famous Bitcoin forum. 

Since its inception, Litecoin has been perceived as a coin created to contend with Bitcoin’s gravitation to centralization.

Hence, Litecoin embraced many of Bitcoin’s characteristics, which Lee and allies felt worked for Bitcoin in its initial stages. Similarly, Litecoin has other Bitcoin elements that the developers felt could be enhanced. 

Some remarkable Litecoin characteristics include the following:

Proof-of-work: Litecoin employs proof-of-work. But it depends on the entrance to vast memories instead of GPU or CPU computing strength alone. 

Uses Scrypt: Litecoin utilizes Scrypt for its hashing process. Scrypt employs SHA-256 but incorporates additional memory needs for proof-of-work. This reduces its reliability on GPU arithmetic logic units and, consequently, ASIC mining appliances.

The Difference Between Bitcoin and Litecoin

Although these two currencies have some similarities, they’re majorly different. And here’s what makes their difference:


Bitcoin and Litecoin use different algorithms. Bitcoin utilizes SHA-256, while Litecoin employs Scrypt, 

The two algorithms work differently when it comes to mining new coins. Transactions on both Bitcoin and Litecoin need more computing power to be verified.

Likewise, the miners attempted to use some refined techniques to try and mine Bitcoins efficiently. They opted to utilize hardware schemes called ASICS to mine Bitcoins to achieve this.

Scrypt was created so that it isn’t as liable to the ASIC-based mining custom hardware systems as Bitcoin, which attracted investors to Litecoin because it seemed accessible to aspiring miners.

Market Capitalization

Market capitalization is another area in which Bitcoin and Litecoin are different. Because big mining pools and companies can mine Bitcoin, it’s more famous. Consequently, its demand has notably increased, making it a high crypto-to-dollar exchange rate. Litecoin’s marketability is limited by Bitcoin’s smaller supply and tremendous demand.


Bitcoin vs. Litecoin other difference is the number of coins each can create. The Bitcoin grid can only hold 21 million coins, while Litecoin can house 84 million. However much this seems like Litecoin’s edge over Bitcoin, demand, supply, and investor opinion determine entities’ prices. All three favor Bitcoin,n and its price prove the same.

Transaction Speed

Technically transactions happen immediately on Litecoin and Bitcoin networks. But some time is needed for the transaction to be verified by other network players. Litecoin was established with special consideration to speed.

The Bitcoin network’s standard transaction verification time is nine minutes, depending on the network traffic. At the same time, Litecoin’s network average transaction confirmation time is two and a half minutes.

Bitcoin vs. Litecoin FAQs

Here are the frequently asked questions about Bitcoin vs. Litecoin:

Is Litecoin more secure than Bitcoin?

Bitcoin’s blockchain is considered more secure than Litecoin’s due to its higher hashing rate. An excellent hash rate signifies additional computational power is needed to execute a 51% attack. Currently, Bitcoin’s blockchain is remarkably immune to possible hacks.

Which is better: Bitcoin or Litecoin?

Both Bitcoin and Litecoin have a supply cap on their amount of tokens. Bitcoin’s cap is 21 million tokens, while Litecoin’s is set at 84 million tickets. Since Litecoin has a larger supply of tokens, its network retains incredible liquidity likened to Bitcoin. Yet, Bitcoin’s scarcity makes it more worthwhile.

Can I Send Litecoin to a Bitcoin Address?

No, you can’t send Litecoin to a Bitcoin address because doing so may result in losing your money. However, you may be able to redeem it after a struggle.

Can You Convert Litecoin to Bitcoin?

Yes, it’s possible to turn Litecoin into Bitcoin and Bitcoin into Litecoin. All that is required is a reliable exchange platform or trading app.

Why Is Litecoin So Cheap?

Litecoin has an affordable LTC/USD exchange rate due to its enormous supply and insufficient demand compared to Bitcoin and other coins.

Final Thoughts

Bitcoin and Litecoin have their differences as well as a few likenesses. They all can be viable investment opportunities. You can convert one into the other and vice versa. However, consider what each has to offer before investing in either. Then choose the one that best suits your desired goal.

Leave a Reply

Your email address will not be published. Required fields are marked *