Difference between revisions of "Bitcoin and Litecoin Comparison"
From Litecoin Wiki
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===Cons=== | ===Cons=== | ||
| − | * Attacks by | + | * Attacks by [http://en.wikipedia.org/wiki/Botnet botnets]. If the botnet operator runs an unmodified litecoind in order to earn coins then such a botnet only attacks the computers under its control, not Litecoin itself, as it would actually strengthen the Litecoin network. However, the objective of a crypto-currency is to improve the world rather than to improve itself. Botnets with a high enough proportion of the total hash power could try [https://en.bitcoin.it/wiki/How_bitcoin_works#Double_spending double-spending] attacks on the Litecoin network. |
==Faster transaction time== | ==Faster transaction time== | ||
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* Unstable difficulty might encourage chain hopping. | * Unstable difficulty might encourage chain hopping. | ||
| − | * Less security from attacks that rely on lowering the difficulty. Example: an attacker makes a one time investment in hash power, uses this hash power to start extending a recent block with his own fork of consecutive blocks while lowering the difficulty (easier to do with the shorter retarget window), isolates a node of e.g. some online bank from the rest of the network, waits until his fork is longer than what this node has already seen in the real blockchain, broadcasts his forked chain to this node, and with the lower difficulty he now needs less hash power to continue to communicate with the isolated node until it agrees to transact in the forked chain. | + | * Less security from attacks that rely on lowering the difficulty. Example: an attacker makes a one time investment in hash power, uses this hash power to start extending a recent block with his own fork of consecutive blocks while lowering the difficulty (easier to do with the shorter retarget window), isolates a node of e.g. some online bank from the rest of the network, waits until his fork is longer than what this node has already seen in the real blockchain, broadcasts his forked chain to this node, and with the lower difficulty he now needs less hash power to continue to communicate with the isolated node until it agrees to transact in the forked chain. [https://bitcointalk.org/index.php?topic=46498.msg556137#msg556137] |
==Total number of coins in existence== | ==Total number of coins in existence== | ||
| − | The total number of litecoins that will come into existence is 4 times the total number of bitcoins that will come into existence, 84 million compared to 21 million. The reward for each Litecoin block is 50 litecoins. The rate of litecoins generation is halved every 840,000 blocks, i.e. 4 times more blocks than with Bitcoin. Since Litecoin blocks are generated 4 times faster than Bitcoin blocks, this means that the monetary inflation of Litecoin follows the same trajectory as that of Bitcoin | + | The total number of litecoins that will come into existence is 4 times the total number of bitcoins that will come into existence, 84 million compared to 21 million. The reward for each Litecoin block is 50 litecoins. The rate of litecoins generation is halved every 840,000 blocks, i.e. 4 times more blocks than with Bitcoin. Since Litecoin blocks are generated 4 times faster than Bitcoin blocks, this means that the monetary inflation of Litecoin follows the same trajectory as that of Bitcoin [https://en.bitcoin.it/wiki/Controlled_Currency_Supply] [http://en.wikipedia.org/wiki/Bitcoin#Monetary_differences], so for example at the year 2020 around 3/4 of all litecoins will have already been generated. |
==Bug fixes== | ==Bug fixes== | ||
| − | * Time warp bug | + | * Time warp bug [https://bitcointalk.org/index.php?topic=43692.msg521772#msg521772]: the Bitcoin difficulty calculation is off by one block, so an attacker can repeatedly try to generate the last block of each retarget window, and use a fabricated timestamp of 2 hours into the future in order to make the time difference from the first block in the retarget window high, thus lowering the difficulty by 0.5%. Because of the bug, the bogus timestamp isn't used as the first block in the next retarget window, and therefore the 2 extra hours aren't being compensated for in the next difficulty calculation. Once the difficulty is low, the attacker can mine many fast coins, or in the case of a small chain, an attacker with 51% hash power could reduce the difficulty to 1 and mine a new fork from the genesis block. This isn't a feasible attack on Bitcoin, because the probability of repeatedly generating the last block once every 2 weeks at such high difficulties is negligible. Although fixing this issue in Bitcoin is possible, it should be done carefully (by adding rules that encourage nodes to upgrade over time) so to avoid a chain fork, i.e. old clients who didn't upgrade might operate with another difficulty and therefore disagree regarding which blocks are valid. In Litecoin this bug is fixed. [https://github.com/coblee/litecoin/commit/b1be77210970a6ceb3680412cc3d2f0dd4ca8fb9] |
==Conclusion== | ==Conclusion== | ||
The purpose of Litecoin is to function as silver to Bitcoin's gold, in the sense of being a relatively less valuable coin that is easier to obtain and transact with. The properties that make Litecoin fit to accomplish this objective can be summarized as follows: | The purpose of Litecoin is to function as silver to Bitcoin's gold, in the sense of being a relatively less valuable coin that is easier to obtain and transact with. The properties that make Litecoin fit to accomplish this objective can be summarized as follows: | ||
| − | * Transactions are 4 times faster than with Bitcoin, in exchange for | + | * Transactions are 4 times faster than with Bitcoin, in exchange for possibly weaker security guarantees (depending on human behavior). |
| − | * CPU mining means that the barriers to entry into the Litecoin mining market are cheap relative to Bitcoin mining. | + | * CPU/GPU mining means that the barriers to entry into the Litecoin mining market are cheap relative to Bitcoin mining. |
* The total amount of litecoins is 4 times higher than the total amount of bitcoins. | * The total amount of litecoins is 4 times higher than the total amount of bitcoins. | ||
