Last updated 2nd April 2014.In 2009, Satoshi Nakamoto launched bitcoin as the world's first cryptocurrency.The code is open source, which means it can be modified by anyone and freely used for other projects.Many cryptocurrencies have launched with modified versions of this code, with varying levels of success.Litecoin was announced in 2011 with the goal of being the 'silver' to bitcoin's 'gold'.At the time of writing, Litecoin  has the highest market cap of any mined cryptocurrency, after bitcoin.Here's our guide to show you the crucial difference between bitcoin and litecoin.At-a-glance differences bitcoin litecoin Coin limit 21 Million 84 Million Algorithm SHA-256 Scrypt Mean block time 10 minutes 2.5 minutes Difficulty retarget 2016 block 2016 blocks Block reward details Halved every 210,000 blocks.Halved every 840,000 blocks Initial reward 50 BTC 50 LTC Current block reward 25 BTC 50 LTC Block explorer blockchain.info Created by Satoshi Nakamoto Charles Lee Creation date January 3rd, 2009 October 7th, 2011 Market cap $10,467,596,650.78 $540,274,528.26 Bitcoin Statistics Litecoin Statistics Mining differences Just like bitcoin, litecoin is a crytocurrency that is generated by mining.

Litecoin was created in October 2011 by former Google engineer Charles Lee.The motivation behind its creation was to improve upon bitcoin.The key difference for end-users being the 2.5 minute time to generate a block, as opposed to bitcoin's 10 minutes.Charles Lee now works for Coinbase, one of the most popular online bitcoin wallets.For miners and enthusiasts though, litecoin holds a much more important difference to bitcoin, and that is its different proof of work algorithm.Bitcoin uses the SHA-256 hashing algorithm, which involves calculations that can be greatly accelerated in parallel processing.It is this characteristic that has given rise to the intense race in ASIC technology, and has caused an exponential increase in bitcoin's difficulty level.Litecoin, however, uses the scrypt algorithm – originally named as s-crypt, but pronounced as 'script'.This algorithm incorporates the SHA-256 algorithm, but its calculations are much more serialised than those of SHA-256 in bitcoin.Scrypt favours large amounts of high-speed RAM, rather than raw processing power alone.

As a result, scrypt is known as a 'memory hard problem'.The consequences of using scrypt mean that there has not been as much of an 'arms race' in litecoin (and other scrypt currencies), because there is (so far) no ASIC technology available for this algorithm.However, this is soon to change, thanks to companies like Alpha Technologies, which is now taking preorders.To highlight the difference in hashing power, at the time of writing, the total hashing rate of the bitcoin network is over 20,000 Terra Hashes per second, while litecoin is just 95,642 Mega Hashes per second.For the time being, 'state of the art' litecoin mining rigs come in the form of custom PCs fitted with multiple graphics cards (ie: GPUs).These devices can handle the calculations needed for scrypt and have access to blisteringly fast memory built into their own circuit boards.There was a time when people could use GPU mining for bitcoin, but ASICs have made this method not worth the effort.Transaction differences The main difference is that litecoin can confirm transactions must faster than bitcoin.

The implications of that are as follows: Litecoin can handle a higher volume of transactions thanks to its faster block generation.If bitcoin were to try to match this, it would require significant updates to the code that everyone on the bitcoin network is currently running.buy bitcoin for silk roadThe disadvantage of this higher volume of blocks is that the litecoin blockchain will be proportionately larger than bitcoin's, with more orphaned blocks.bitcoin to dogeThe faster block time of litecoin reduces the risk of double spending attacks – this is theoretical in the case of both networks having the same hashing power.bitcoin 2014 in amsterdamA merchant who waited for a minimum of two confirmations would only need to wait five minutes, whereas they would have to wait 10 minutes for just one confirmation with bitcoin.bitcoin mining tax calculator

Transaction speed (or faster block time) and confirmation speed are often touted as moot points by many involved in bitcoin, as most merchants would allow zero-confirmation transactions for most purchases.It is necessary to bear in mind that a transaction is instant, it is just confirmed by the network as it propagates.bitcoin hosting wikiBitcoin Litecoin image via Flickr.bitcoin cash dispenserMining Rig image via Wikipedia.bitcoin quebecMining USB devices Image via Shutterstock.bitcoin viewtopicThis guide reveals how to buy litecoin using fiat currency or bitcoins.amazon adopting bitcoinIt's a decentralized digital currency Why Use Bitcoin?

It's fast, cheap to use, and secure How Can I Buy Bitcoins?From an exchange or an individual How to Buy Bitcoin in the UK Buying bitcoin in the UK How to Store Your Bitcoins Use a digital or paper wallet What Can You Buy with Bitcoin?Spend your bitcoins How to Sell Bitcoin A guide on how to sell your bitcoins How to Accept Bitcoin Payments for Your Store Learn about bitcoin POS systems How do Bitcoin Transactions Work?Bitcoin addresses and private keys Is Bitcoin Legal?The current regulation around bitcoin Who is Satoshi Nakamoto?The founder of bitcoin How Bitcoin Mining Works By confirming transactions How to Set Up a Bitcoin Miner Generate bitcoins yourself What are Bitcoin Mining Pools?What are pools how and how to join them?How Does Cloud Mining Bitcoin Work?Alternative bitcoin mining solutions How to Calculate Mining Profitability Can you make a ROI?How to Make a Paper Bitcoin Wallet Creating an unhackable bitcoin wallet What is the Difference Between Litecoin and Bitcoin?

It's the silver to bitcoin's gold How to Buy Litecoin How to buy the bitcoin alternative litecoin How to Mine Litecoin and other Altcoins How to generate your own altcoins Understanding Bitcoin Price Charts A primer on bitcoin price charts Bitcoin E-Commerce Services for Merchants How to accept bitcoin at your business What is Blockchain Technology?A system of distributed data and logic How Does Blockchain Technology Work?Cryptographic keys, distributed networks and network servicing protocols What Can a Blockchain Do?Identity, recordkeeping, smart contracts and more What is a Distributed Ledger?A dynamic, independently maintained database What is the Difference Between Public and Permissioned Blockchains?Can anyone read or write to the ledger?What is the Difference Between a Blockchain and a Database?It begins with architectural and administrative decisions What Are the Applications and Use Cases of Blockchains?Tokenization, auditing, governance, settlement and more How Could Blockchain Technology Change Finance?

Cross-border payments, new asset classes, regulatory compliance and more What are Blockchain's Issues and Limitations?Complexity, size, costs, speed, security, politics and more Why Use a Blockchain?To manage and secure digital relationships as part of a system of record What is Ethereum?A blockchain application platform and 'world computer' What is Ether?The 'fuel' of the ethereum network How to Use Ethereum Wallets, trading and ‘dapps’ Who Created Ethereum?Vitalik Buterin How Ethereum Mining Works 'Proof of Work' and 'Proof of Stake' How to Mine Ethereum GPUs, mining software and pools How Ethereum Works 'Turing-complete' programming, 'state' and the 'EVM' What is a Decentralized Application?A distributed 'smart contract' system What is a DAO?A 'decentralized autonomous organization' How Do Ethereum Smart Contracts Work?Code, transaction fees and 'gas' How Will Ethereum Scale?‘Sharding’ and ‘off-chain’ transactions