Litecoin is considered by many to be the silver to Bitcoin's gold. But why is that? (besides the fact that Litecoin is silver colored and Bitcoin is an orange color). Today, I'll be talking about what Litecoin is and how it compares to Bitcoin.

What is Litecoin?

Litecoin is a proof of work crypto currency created by former Google employee, Charlie Lee. Its name comes from the idea that Charlie wanted to create a "lite version of Bitcoin" with improvements over its predecessor. Litecoin is one of the most popular cryptocurrencies in the world, with a nearly $6 billion dollar marketcap. It currently sits at number 7 on CoinMarketCap, with a price of $87.

Similarities

Litecoin and Bitcoin are similar in many aspects. Both are proof of work coins, meaning miners verify transactions and receive payment rewards. Litecoin was also built on the same protocol as Bitcoin. Litecoin was essentially built to be an upgraded version of Bitcoin.

Differences

One of the most notable differences between the two is the transaction speed. Litecoin generates new blocks about once every 2.5 minutes, which is 4x faster than Bitcoin's rate of one block every 10 minutes. Litecoin also uses a different algorithm, known as Scrypt. Bitcoin uses an older algorithm called SHA-256. The scrypt algorithm makes it less susceptible to ASIC-mining. ASICs have long dominated Bitcoin mining and are seen as inaccessible to the average person. This way, Litecoin makes mining more accessible, as many people still mine Litecoin with CPU's or GPU's.

Litecoin also features significantly cheaper transaction fees compared to Bitcoin, with fees only around a couple cents.

In conclusion, Litecoin and Bitcoin are both proof of work currencies built on the same protocol. However, Litecoin comes with faster transaction speeds, lower transaction costs and a more accessible algorithm in terms of mining.