Brought to you by the Liquid team to help you make sense of crypto.
For investors looking to hold for the long term, picking a favorite out of coins in the top 20 can be tricky.
Litecoin vs Ethereum is a valid comparison to make, but once you dive deep it is interesting how different the two coins actually are.
Litecoin vs Ethereum: What’s the difference?
Despite the fact that both Litecoin and Ethereum are cryptocurrencies, from a technical standpoint, they are worlds apart, both created to achieve very different things.
Litecoin is a source code fork of Bitcoin.
Litecoin creator Charlie Lee took the Bitcoin open source code and modified it to create Litecoin in 2011, aiming to bring the world a digital silver, sidekick to Bitcoin, digital gold.
Litecoin is a digital peer-to-peer cryptocurrency and payment method. Litecoin harnesses the fundamentals of Bitcoin but tries to improve on its appeal as a currency.
Litecoin has much faster transaction times than Bitcoin with lower fees and block mining time of 2.5 minutes, compared to Bitcoin’s is 10 minutes.
What about Ethereum?
Now we know that Litecoin is a modified version of Bitcoin, let’s take a look at what Ethereum is all about and start to see some of the differences as we explore Litecoin vs Ethereum.
Ethereum is a cryptocurrency that facilitates the creation of self-executing digital contracts known as smart contracts.
Ethereum is actually the name of the software, while the tradable cryptocurrency is known as Ether (ETH).
Ethereum was the first crypto project to introduce smart contracts but since then others have taken the idea and implemented it themselves.
Much like Litecoin, the founders of Ethereum are well known. You may have heard of Vitalik Buterin, the founder and main face of Ethereum.
Ethereum is responsible for the rise of ICOs that occurred in 2017 because it has a coding language, known as Solidity, that allows developers to easily build their crypto projects on the Ethereum network.
We can see already in this Litecoin vs Ethereum discussion that they are fundamentally different projects with completely different goals.
In terms of investment opportunities, to weigh up Litecoin vs Ethereum it’s important to consider which project you believe has the stronger fundamentals that will propel it towards growth in the future.
You can consider which project may have more success in the future based off its position in the market, how unique it is, and how successful it has been in the past.
Price action of Litecoin vs Ethereum
Both Litecoin and Ethereum have had their ups and downs. Ethereum has reached significantly higher heights than Litecoin.
In December 2017 Litecoin reached a market cap of just over USD20 Billion. Shortly after, in January 2018 Ethereum reached a market cap of US138 Billion, almost seven times larger than Litecoin’s all time high.
Ethereum’s previous heights may lend credence to its future success being somewhat larger than Litecoin’s.
How unique is each one?
Ethereum was the first mover to introduce smart contracts, massively changing the cryptocurrency landscape.
Ethereum has been the building block to bring a lot of larger projects onto the scene and was responsible for the ICO mania of 2017, making Ether perhaps the second most well known cryptocurrency behind Bitcoin.
Litecoin doesn’t fall short of recognition either, but it’s somewhat shrouded by Bitcoin, and arguably competes with Bitcoin Cash in some regards as a faster, cheaper alternative to Bitcoin.
While Ethereum is leading the pack, Litecoin is a key player, but is making moves to establish itself as a superior payment method.
Litecoin gets a lot of exposure, popping up in places like the Ultimate Fighting Championship, making strides to mass recognition and adoption.
Conclusion: Which should I pick in Litecoin vs Ethereum?
There is no definitive answer for which you should pick out of Litecoin and Ethereum. Only you can decide which project you believe has the fundamentals and use case required to fuel future growth.
It’s important to consider that cryptocurrency is an emerging asset class, and while it may appear there is a lot of room for growth, this is not always the case.
There is always risk with investment.
That said, if you believe that each project is fundamentally sound, there is nothing stopping you from investing in each one, be it for long or short term.
WRITTEN BYAlex Aves
"Baby shark" of the Liquid marketing team.