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Why does Litecoin transact faster and cheaper than Bitcoin?

Litecoin transactions

October 15, 2020 | 

JOHN K MWANIKI |  0 Comments| 

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Transaction costs and speeds are the ever-present phenomena in crypto. Most users are looking for fast transactions while maintaining low costs. For now, the two seem a little hard to achieve in Bitcoin and Litecoin. 

Litecoin transacts faster and cheaper compared to Bitcoin. This is due to the shorter confirmation period. 

Litecoin confirms a transaction within 2.5 seconds. It is four times quicker compared to Bitcoin's 10 seconds

The main reason for Bitcoin's more extended confirmation period is demand. The coin's network hosts way more users. The more the demand, the more the stress is one of the available resources. As the most used crypto in the world, Bitcoin's network stays busy most of the time. 

The other concern is the transaction fees. Once the demand for the network becomes high, transacting also becomes more challenging. Those looking to join the system have to pay more. That means transacting in Bitcoin is costly than in Litecoin. Users in need of better speeds at times have to pay more. 

Even though both coins operate the same, Litecoin has less demand. It has more available space on the network. With space, it can accommodate several transactions at the same time. It comes with the higher transaction and lowers costs. 

Litecoin is more efficient for merchants accepting cryptocurrencies. 

Litecoin Transaction Speeds and Scalability 

The scalability of a cryptocurrency is a determinant of speed. The low transaction speeds of Bitcoin have been a concern. Users have been looking for ways to improve their state. 

The first group to raise the concern was those who felt the need to increase blockchain size. This would see it handle more transactions within a single block. The Bitcoin users failed to reach a consensus. The pro-block size increase formed Bitcoin Cash

The issues on transactions persisted, leading to the adoption of Segwit. It is a method that removes the signatures as part of transactions. Other transactions could then occupy the left space on the blockchain. The technique has worked as envisioned, yet the speeds are still low. 

The fastest currencies in both fiat and cryptos have scalable networks. These networks can accommodate several transactions at the same time for quicker outcomes. For example, the fastest crypto, Apollo, provides for limitless storage. Space allows its optimal speeds and scalability

Gold also has a history of speedy transactions. Gold-backed cryptos like GSX, then hosted by Apollo, also offer stellar speeds. 

Other Fast Transaction Speeds Cryptocurrencies 

Other than Bitcoin and Litecoin, several cryptos have been investing in transaction speeds. The speeds are the selling point for these cryptos. Here are some of the digital currencies with impressive transaction speeds; 

  • EOS

Launched in 2018, EOS is more like an Ethereum direct competition. It provides for transaction speeds of 1.5 seconds. Its protocols can handle around 3000 transactions per second

It is also lucrative with the elimination of transaction costs while promoting scalability. Like Ethereum, EOS supports a DApps infrastructure. It allows developers to use its platform for applications without third-party interference. 

  • Ripple (XRP)

Ripple is one of the fastest top-rated cryptos. It comes with a transaction speed of four seconds. These high speeds are useful in its role of connecting the various currencies. Financial institutions and payment providers use it to transfer value and build enterprises. 

The speeds have also made it useful for cross-border transactions. It combines the rates with its low transaction costs of $0.00001. These features make it the ideal coin for remittance

It also a unique inter-ledger protocol for the payments. 

  • Stellar Lumens (XLM)

Stellar is a reliable distributed payment infrastructure with transaction speeds of five seconds. It is almost like Ripple, given that it is a fork of XRP. Like Ripple, it also provides for low transaction costs. 

While Ripple focuses on large institutions, XLM is all about individual transactions. It provides for affordable international payments involving different currencies. 

XLM keeps data and transaction history on distributed ledgers. It uses a Stellar protocol consensus protocol in transactions. 

  • Apollo (APL)

Apollo is the fastest and most feature-rich cryptocurrency. It provides for a sub-second to two-seconds per transaction. Such high speeds have seen it become a favorite of large-scale transacting entities. Banks and governments are some users preferring APL. 

APL is all about sustainability. It is the first blockchain to use database-level sharding. It also comes with other advanced features like adaptive forging and node synchronization. It makes wallets quantum-resistant and also has an atomic swap. 

The Future of Cryptocurrency Speeds

Even though the cryptocurrencies are becoming mainstream, the transaction speed is an issue. Users prefer the fiat currency payment methods due to the high transaction speeds. Visa, for example, can handle 24,000 transactions per second

Digital cryptocurrencies are fast catching up on transaction speeds.  Ripple, for example, has 1500tps. 

It is already beating some fiat payment methods. It surpasses PayPal that manages 193tps

The other slow coins are coming up. Ethereum manages 20 transactions per second, while Bitcoin Cash handles 60. The cryptocurrency world understands its development relies on transaction speeds. For that, the future coins will be concentrating on raising their capabilities. 

Even though Bitcoin has no plans to improve on speeds, it will gain from increased crypto speeds. A speedy blockchain would see it partner with the off-chain nodes. Already, coins like Chainlink are connecting the two worlds.  With the increased speeds, the transactions would be almost instant. 

The on-chain and off-chain layers would lead to more nodes, applications, and channels. The increased application will mean an expanding cryptocurrency world. When the crypto-economy grows, Bitcoin has to grow as well, irrespective of the coin in use. BTC remains the most trusted crypto. 

Several companies are looking to gain from the increasing transaction speeds. For that, the future of cryptos is higher speeds. It might beat the fiat currency applications in the long run. 

Litecoin Transactions Bottom Line 

Litecoin has worked as Bitcoin's evolution. It comes with several features as the top currency. It yet beats it when it comes to transaction speeds and costs of transactions. 

Litecoin's network has low demand hence ease of scalability for faster transactions. The low demand also means low costs. 

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