The introduction of Bitcoin by Satoshi Nakamoto on the January of 2009 created a new world-wide phenomenon that’s causing a major shift in the financial market on a global scale. Bitcoin is the first form of a proper, decentralized, peer-to-peer payment system that operates solely in the digital realm.
This revolutionary digital currency uses cryptography to generate and verify transactions made using it. All transactions are put together into using cryptographic formulae called blocks and all the blocks are linked to one another. Hence this log is more commonly known as a block of chains and the technology subsequently is known as Blockchain technology.
Recent times have seen a massive surge in popularity of Bitcoin and the hundreds of other cryptocurrencies that have been published since. From all the other cryptocurrencies that have entered the scene, Litecoin in particular has garnered a lot of interest. Litecoin’s creators have gone so far as to saying that they intend to make Litecoin the ‘silver’ to Bitcoin’s ‘gold’.
Bitcoin and Litecoin happen to look quite similar at a first glance and they do have quite a lot in common. They’re both decentralized forms of currency that’s independent from regulatory bodies and are not affected by what happens to the fiat currencies we use (Like the US Dollar). The value of both these currencies subsequently doesn’t depend on any central body but on the integrity of their own cryptographic network itself.
One of the fundamental differences between Bitcoin and Litecoin is their market capitalization and their popularity. The current market cap of Bitcoin sits at a gargantuan $79,437,888,061 USD worth while the market cap for Litecoin sits at a comparatively meager $2,670,576,057 USD. Yes that’s a huge difference in their respective market caps but we also have to consider that Litecoin came around later than Bitcoin even though it is doing well. That qualifies Bitcoin as the popular of the two.
The total number of coins in both these currencies is also a primary difference between the two. The Bitcoin blockchain network will never exceed a total number of 21 million bitcoins whereas Litecoin has their limit on the total number of litecoins set at 84 million. But all things considered, this is just an advantage that Litecoin seems to have over Bitcoin in theory. The reality of it is that both these currencies are divisible to nearly infinitesimal amounts. For instance, the minimum quantity of transferable Bitcoin is known as a ‘satoshi’ and it amounts to 0.00000001 bitcoins.
This might be a bit of a psychological advantage for those using litecoin instead of Bitcoin for everyday small transactions. For instance if we suppose a $5 ice cream costs 0.00923647 bitcoins while or in litecoins, it would cost around 1 litecoin. The figures were just for consideration but they put the point across. Bitcoin transactions would be very psychologically challenging in day-to-day affairs. Decimal numbers can actually do that to you.
While it is a fact that right now, Bitcoin sets the Gold standard for cryptocurrencies and Litecoin arguably sets the Silver standard, it is widely known that the status quo can change at any time in the volatile world of cryptocurrency so we can’t use these as permanent labels for the two. Maybe another form of digital currency might topple both of them over. You never know (Hints at Ethereum).