The key difference: Litecoin and its supply four times larger than Bitcoin

Being pioneer in the cryptocurrency market, the Bitcoin blockchain network and its native token BTC paved the way for many other digital assets that emerged later. But, many of these new coins were born with changes and with certain levels of innovation which aimed to improve on what its predecessor offered.

However, most of them failed to achieve success. But, there is a success story: the one on the net Litecoin and its cryptocurrency LTCThis token is one of the few cryptocurrencies that managed to not only implement significant differences that optimize certain aspects of the Bitcoin system, but has also surpassed its predecessor in key aspects such as the number of asset units available for trading, the speed of transactions and a way to validate each operation with a much more environmentally friendly process.

Bitcoin supply vs. Litecoin supply

A significant difference, perhaps the most important, between Bitcoin and Litecoin lies in the total number of tokens available for trading with them. Bitcoin has a maximum limit of 21 million of coins. But, Litecoin has 84 million.

This might seem like an advantage for Litecoin, but in reality it is only partly so because Cryptocurrency prices are primarily influenced by supply and demand.In this sense, the scarcer an asset is, the higher its price can be.

Moreover, consumer and investor confidence It is a key factor in the demand for any product, and it is even more so in the case of cryptocurrencies such as Bitcoin, which, being more popular and having a lower supply, reaches higher prices in this case compared to Litecoin.

Now, Both cryptocurrencies share the block reward halving mechanism., which occurs approximately every four years. However, the calendar used by Litecoin differs from that used by Bitcoin.

This is based on the fact that LTC was launched later. In this timeline, the next halving is estimated to be Litecoin will take place on July 30, 2027. By that date the estimated block reward will decrease to 3,125 LTC. Meanwhile, the latest and most recent halving of Bitcoin occurred on April 19, 2024, reducing its block reward to 3,125 BTC.

There is, however, something important to clarify about the amount of LTC tokens versus BTC tokens is that the limit of the first cryptocurrency was intentionally established, based on the premise that, since Litecoin is designed for small transactions and retail investors, there should be four times more coins in circulation than the Bitcoin network offers.

Other key differences

There are other Key differences between the Bitcoin and Litecoin networks and it is important to know before investing in one or the other, or even both:

Transaction speed

On the blockchain of Bitcoin, the average time to confirm a transaction is around 10 minutes, although this period can vary considerably depending on network congestion and the rates users are willing to pay. On the contrary, In Litecoin, transactions are confirmed in an average of 2,5 minutes. (four times faster than Bitcoin) This feature makes this cryptocurrency a more practical option for everyday use. 

The time difference between both platforms is mainly due to to the limited size of its Bitcoin blocks, characteristics that contrast with Litecoin because each block in its chain has a higher limit and allows more transactions to be included per block to process them more efficiently.

Commissions per operation

Bitcoin transaction fees tend to be higher than Litecoin., especially during times of high network congestion. This is also due to blockchain capacity: BTC's capacity is lower than LTC's.

so that their Transactions be processed with faster, Bitcoin users who handle more transaction flow per minute are often forced to pay higher rates. On the other hand, Litecoin is characterized by offering much lower commissions because its blocks have the ability to handle a larger number of transactions per block and per minute, which reduces competition for available space and allows rates to remain low, even during periods of high demand.

Mining processes and their environmental impact

As for cryptomining or the process of generating and validating transactions, Bitcoin uses the SHA-256 algorithmThis technology requires the use of specialized hardware or physical equipment called ASICs. These are integrated circuits designed specifically for this purpose. These devices offer great processing power, but are expensive, require a large amount of physical space, and consume a lot of electricity.

On the other hand, Litecoin uses the Scrypt algorithm. With this, although it requires a large amount of memory, it was created with the intention of not requiring ASICs. Consequently, it allows mining to be more decentralized and to be done with less specialized and cheaper hardware such as GPUs or graphics cards and CPUs or processors. Therefore, These devices require less energy, which translates into a smaller carbon footprint and are more environmentally friendly.