Cryptocurrencies have come a long way since Satoshi Nakamoto originally described Bitcoin (BTC) in a 2008 white paper, but older tokens still dominate the landscape. Bitcoin invented the concepts of decentralised finance (DeFi) and distributed public ledgers (called blockchains), with every subsequent token (known as altcoins) following its example. Litecoin (LTC) was amongst the first to retain Bitcoin’s tokenomics, with slight modifications.
While many see altcoins as inherent Bitcoin competitors, Litecoin was developed as a complementary token. Many developers have worked on both protocols, and neither would be where it is today without the other. Below we take a closer look at two of the oldest and most popular cryptocurrencies.
Key Differences Between BTC and LTC
Bitcoin Overview
Nakamoto envisioned Bitcoin as a digital currency for peer-to-peer (P2P) electronic transactions that didn’t rely on large banks or world governments. The first token was created on 3 January 2009, and Bitcoin quickly gained a small but enthusiastic following. Nakamoto was initially heavily involved in the community, but ultimately chose to step away to avoid centralisation, handing the network alert key and control of the code repository to Gavin Andresen. Nakamoto’s identity remains unknown, and Andresen became the Bitcoin Foundation’s lead developer.
Most crypto enthusiasts agree that Bitcoin’s design is the key to its success. Nakamoto coded a hard cap of BTC directly into the protocol, protecting its value from overinflation. The network also has a Proof of Work (PoW) consensus mechanism to verify transactions without relying on any third party, promoting privacy and security, and BTC provides access to stable currency anywhere with an internet connection, levelling the economic playing field.
Nakamoto realised Bitcoin wasn’t perfect and allowed the community to change it as needed. Two of the most significant upgrades in Bitcoin history are ‘Segregated Witness’ (SegWit) and ‘Taproot’. Segwit was implemented in August 2017 to improve scalability through Layer-2 blockchains like the Lightning Network. Taproot was implemented in November 2021 to improve the Lightning Network’s functionality.
Software engineer Charlie Lee was an early Bitcoin supporter but saw potential issues, including that large companies used Application-Specific Integrated Circuit (ASIC) mining rigs to centralise transaction processing and associated rewards. High transaction fees limited BTC as an everyday medium of exchange, and Lee decided a ‘light’ version of Bitcoin would solve these problems, creating Litecoin in October 2011 as a peer-to-peer internet currency enabling instant, near-zero cost payments to anybody.
Litecoin is a source code fork of Bitcoin, so the two tokens share many characteristics. However, Lee changed the hashing algorithm from Bitcoin’s SHA-256 to Scrypt, making mining accessible to the community again, as the existing ASIC mining rigs were too specialised for the Scrypt algorithm. LTC also has a faster payment confirmation schedule for speedy transaction processing and lower fees. Lee adjusted Litecoin’s tokenomics by quadrupling the maximum supply. LTC is still scarce, but not as scarce as BTC, setting it up as the ‘silver’ to Bitcoin’s ‘gold’.
Litecoin has evolved, and ASIC mining rigs for the Scrypt algorithm were released in 2014, again centralising the network’s hashrate. Litecoin got its own SegWit upgrade in 2018, expediting transactions through a Layer-2 Lightning Network. A second Layer-2, OmniLite, added support for smart contracts and non-fungible tokens (NFTs) on 7 September 2021.
Bitcoin’s PoW consensus mechanism requires miners to include a mathematical proof of work with the transactions in a new block. These proofs can only be generated through trial and error, forcing miners to compete for each block. The victorious miner claims a set block reward, plus the transaction fees assessed by the network. This system is secure, but opponents argue it promotes centralisation by concentrating rewards based on hashrate. PoW also requires high computing power, raising environmental concerns.
Block rewards introduce new BTC into the ecosystem. The initial block reward was 50 BTC, but gets cut in half roughly every four years through Bitcoin halving events. The Bitcoin network will eventually stop distributing block rewards entirely, with miners compensated exclusively through transaction fees.
Litecoin also uses a PoW consensus mechanism that works similarly to Bitcoin’s, where miners compete to find the proper mathematical proof of work through trial and error, with the victor claiming a block reward, plus transaction fees. Block rewards distribute fresh LTC to the ecosystem, halving the amount every four years, as well. Eventually, miners will only receive transaction fees as rewards.
Litecoin’s consensus mechanism isn’t identical to Bitcoin’s, however. It has a block interval of 150 seconds, compared to Bitcoin’s 600, meaning new blocks are added to the Litecoin blockchain more frequently. Litecoin can also be ‘merge-mined’ with Dogecoin (DOGE), providing miners extra revenue without making LTC an inflationary token.
Bitcoin and Litecoin Scalability
Scalability is one of the biggest weaknesses of PoW consensus mechanisms, and both Bitcoin and Litecoin struggle with it. Bitcoin averages about seven transactions per second (tps); altcoins like Solana (SOL) and Avalanche (AVAX), however, are in the hundreds, and large payment processors like Visa are in the tens of thousands. Litecoin averages 54 tps, faring better than Bitcoin but still lagging behind Proof of Stake (PoS) protocols.
Tokenomics Comparison
Bitcoin Use Cases
BTC is the native cryptocurrency of Bitcoin, the oldest and most established blockchain. Transaction fees are paid in BTC on the main network and Layer-2s like the Lightning Network.
BTC is also a secure value store. Crypto speculators frequently purchase BTC for its high price upside potential, though Bitcoin is a volatile asset carrying considerable risk of loss. Financial products like exchange-traded funds (ETFs) may also include Bitcoin, and traders exchange Bitcoin for fiat currencies or other cryptocurrencies on reputable exchanges like Crypto.com. BTC’s established history and high liquidity make it a common cryptocurrency to swap.
Acceptance as a Payment Method
Bitcoin is virtually synonymous with cryptocurrencies, so nearly any merchant who accepts crypto accepts BTC. Major retailers accept BTC, like The Home Depot, Whole Foods Market, and Starbucks, and smaller retailers accept BTC, as well, including Buy-Clash (gaming reseller), Bloom Audio, and CRM Jewelers. Alternatively, there are many options to exchange Bitcoin for popular gift cards.
Litecoin Use Cases
LTC is the native token of the Litecoin network and used to pay transaction fees (including on Layer-2s like Litecoin’s Lightning Network) and purchase NFTs through the OmniLite platform.
LTC is a digital value store that traders can exchange for other cryptocurrencies or fiat currencies, and many crypto exchanges, including Crypto.com, support Litecoin. However, it’s included in fewer trading pairs than Bitcoin because demand for LTC is lower.
Acceptance as a Payment Method
Litecoin is accepted by a variety of merchants, including G2A.com (video games), Sheetz (convenience store chain), and Travala (travel booking platform). LTC holders can also exchange their holdings to buy gift cards through multiple services.
Key Pricing Moments
Cryptocurrencies have a reputation as volatile assets, and the price histories of Bitcoin and Litecoin are amongst the major reasons. Below is a quick timeline for each token:
Bitcoin — Key Price Events
July 2010
The first Bitcoin trading markets emerge, with BTC prices ranging from US$0.0008–$0.08.
2013
BTC gains 6,600% in its first major pump after Chinese traders utilise it to circumvent China’s capital control efforts.
February 2018
BTC drops 10%–20% after China bans cryptocurrency trading, removing a significant market from the community.
2020
BTC reaches $28,993 due to concerns about the global economy during the COVID-19 pandemic, a value increase of more than 400%.
BTC sets new all-time highs (ATHs): $108,304.93 on 17 December 2024 in the crypto bull market following Donald Trump’s 2024 United States Presidential election victory, and $109,319.46 on 20 January 2025, the day of Trump’s inauguration. Expected to pursue pro-crypto policies like creating a favourable regulatory environment, Trump’s win drives a crypto boom.
Litecoin — Key Price Events
October 2011
LTC enters the market with a price point of $0.30.
LTC reaches its ATH of $446.24 in anticipation of its first halving event, which took place on 25 August. Litecoin lost most of its gains shortly after the halving event.
13 September 2021
LTC spikes 30% after news breaks of a partnership between Litecoin and global retailer Walmart. No such partnership existed, and LTC’s price returned to previous levels after both parties denied the report.
19 May 2024
LTC loses 15% of its value due to a crypto bear market and increased competition from other altcoins. The overall downward trend would continue for the rest of the year.
5 December 2024
Litecoin experiences a surge to $142.78 in the Trump election victory bull market, a 118% increase from its price in the hours before the election. Prices remained higher, ranging between $100 and $140 through Trump’s inauguration.
Performance and Market Metrics
As of this writing, Bitcoin ranks first by market cap at about $1.65 trillion. It has a maximum supply of 21 million BTC, with a potential price upside. BTC holders view Bitcoin as an inflation-proof store of value since scarcity is coded into its protocol.
Litecoin has a market cap of nearly $6.8 billion at the time of writing. It has a hard supply cap of 84,000,000 LTC, making it inflation-protected like Bitcoin. However, demand for LTC isn’t as high, and each token has been worth between $85–$140 in early 2025.
Developments and Roadmaps: BTC and LTC
Bitcoin’s Roadmap
A decentralised-enthusiast community governs Bitcoin, so the project doesn’t have clearly defined plans. Furthermore, Bitcoin’s code is considered sacred by many DeFi advocates, and developers generally prefer to work on Layer-2s rather than tamper with it directly. Future improvements will likely entail improved Layer-2 functionality or increased merchant acceptance rather than core changes.
Bitcoin’s Community
Cryptocurrency prices are sensitive to community sentiment, and tracking social media followers and activity can be a great way to determine what people think of a particular token. Bitcoin has over 7.6 million X followers and 7.8 million Reddit followers at the time of writing, indicating an exceptionally large and passionate user base.
Litecoin’s Roadmap
A decentralised community also governs Litecoin, with the Litecoin Foundation coordinating efforts. The project lacks a formal roadmap but offers planned upgrades, including Litecoin Space, a block explorer providing information on ‘mempool transactions’, or transfers that haven’t been confirmed yet. Atomic swaps will expand Litecoin’s interoperability with other blockchains, as well, but there was no timetable for either upgrade at the time of writing.
Both Bitcoin and Litecoin tokens offer plenty to traders. Bitcoin has the highest digital value store with its extreme scarcity and brand recognition, while Litecoin provides faster transaction times that make it more suitable as a means of exchange. Litecoin has scarcity, as well, giving it a greater potential price upside than many other altcoins.
Crypto traders chasing raw profits might choose Bitcoin since it’s worth more per token, but LTC offers a more affordable entry point and the potential to perform better by annual percentage rate (APR). Merchants might prefer Bitcoin’s name or Litecoin’s faster transactions and relatively stable price range.
Always take into account a token’s price history, development team, tokenomics, and any pertinent macroeconomic trends before considering a purchase.
Due Diligence and Do Your Own Research
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Past performance is not a guarantee or predictor of future performance. The value of crypto assets can increase or decrease, and you could lose all or a substantial amount of your purchase price. When assessing a crypto asset, it’s essential for you to do your research and due diligence to make the best possible judgement, as any purchases shall be your sole responsibility.
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