Litecoin Outperforms Bitcoin Cash: Is It Heading to the Top 3?
When Bitcoin was originally created, the idea was for it to become digital cash and make peer-to-peer transactions simple. However, because of the expensive nature and slow transactions, digital cash is no longer what Bitcoin is. In the modern day, it is more like digital gold.
Because of this gap in the market, various cryptocurrency assets have tried to become what Bitcoin was originally supposed to be. Two of the leaders in this category are Bitcoin Cash and Litecoin. Each resides among the top 5 cryptocurrencies by total market cap, and bear many similarities to one another. However, despite their similarities, there are also many differences.
While Litecoin has been around longer, it’s actually Bitcoin Cash that has quickly reached heights in terms of the overall market cap. However, in recent months, Litecoin has been growing steadily. Although the price of Litecoin is lower, it has managed to cast Bitcoin Cash from its long-occupied fourth place in the top 5 list. So, will Litecoin be declared the winner in their race? Or, does Bitcoin Cash have an ace up its sleeve to be the best option for digital cash?
With that in mind, this article is going to look at both Bitcoin Cash and Litecoin, and then look at whether Litecoin will save its current spot in the list, or break into the top 3.
An Introduction to Bitcoin Cash
Bitcoin Cash was first created on August 1, 2017. So, it’s a relatively new cryptocurrency. Bitcoin Cash is used for making transactions or peer-to-peer payments. It originated as a hard fork from Bitcoin, with the main difference being the block size. Bitcoin originally had a block size limit of 1 mb, whereas Bitcoin Cash debuted with an 8 mb block size, which has since been upped to 32 mb.
This allows for much better scalability, which equals cheaper and quicker transactions. Bitcoin Cash hopes to compete with the likes of Paypal and Visa when it comes to the volume of their transactions. While it is far away from that, Bitcoin Cash has grown a lot in the near-two years, as it is one of the largest cryptocurrencies by total market cap. As a result, it is very easy to invest in, because it is found on the world’s largest and most popular exchanges.
An Introduction to Litecoin
On the other hand, Litecoin is one of the oldest cryptocurrencies out there. It was created back in 2011 by Charlie Lee. Like Bitcoin Cash, Litecoin is primarily used for peer-to-peer transactions or payments. It is based on the same protocol as Bitcoin, but a completely different algorithm for hashing is used. It doesn’t use the same SHA 256 that Bitcoin does. Instead, it uses something called Scrypt. Other than that, however, Bitcoin and Litecoin are very similar in terms of their technical details.
Litecoin also addresses other issues with Bitcoin like large fees, slow transaction times and the fact that there’s a fairly concentrated mining pool. In addition to more manageable fees and fast transactions, the security and reliability of Litecoin make it popular. So popular, in fact, that it is now the 4th largest cryptocurrency asset on the planet according to CoinMarketCap. While it took a few years for Litecoin to reach $1 billion in market cap (6 to be exact), it has now become one of the most popular cryptocurrencies.
Litecoin Outperforming Bitcoin Cash
While both are similar, hopefully you now know about a few differences between the two. So, which will ultimately win the battle and become the clear choice for those looking for digital cash?
It is impossible to tell, but many believe Litecoin is making a push to not only pass Bitcoin Cash, but potentially enter into the top 3, joining Bitcoin and Ethereum. The reason for this comes down to the amazing growth this year so far. Litecoin’s market cap has grown from 2 billion at the beginning of the year to around 8 billion at the end of June 2019.
Compare that to the growth of Bitcoin Cash in the same period, and you will see why many people think that Litecoin will continue to outperform its main competitor. Bitcoin Cash began the year with a $1 billion bigger cap than Litecoin’s, and now they are very close to one another. Not only that, but Bitcoin Cash is currently only a shell of its former self in terms of overall value.
Bitcoin Cash has regularly been around $10 billion in total market cap over its history, sometimes reaching well over $20 billion. On the other hand, Litecoin only reached over $10 billion during late 2017 and early 2018. So, why has Litecoin been able to grow so much in recent months?
The reason for this growth is a number of factors. First of all, it comes down to the strong fundamentals of Litecoin. This includes the affordable fees and quick transaction times that Litecoin boasts. Any coin that offers cheap and quick transactions has the potential to grow and be a hit. Another reason for this growth is the excitement for future updates, which are to make transactions even more affordable and efficient than they already are. In addition, the team behind Litecoin is looking to make it more privacy-oriented, which is a sure benefit in the cryptocurrency world.
It is this progress that is leading many people to believe Litecoin will ultimately overtake Bitcoin Cash. Of course, it could still end up like the same situation that is going on between XRP and Ether in their fight for the second spot, but that remains to be seen.
In conclusion, hopefully this article has helped you learn about Bitcoin Cash and Litecoin, as well as whether Litecoin will outperform Bitcoin Cash. As mentioned, it is certainly possible for Litecoin to overtake Bitcoin Cash going forward, but the crypto market is notoriously hard to predict, so it’s tough to say.