Why not Litecoin?
Litecoin faces several challenges that may limit its competitiveness as a significant alternative to Bitcoin Cash. Here are key points explaining why Litecoin might not be a strong competitor:
Litecoin markets itself as the "silver to Bitcoin's gold." However, the historical context of silver being a practical supplement to gold for coin minting doesn't apply to cryptocurrencies, where software can accurately divide coins into fractions.
In its first days, Litecoin underwent an "instamine". While there are normally 576 blocks mined per day, the first two days of its existence saw the creation of approximately 10,000 blocks, generating half a million coins extremely quickly. This behavior does not instill trust in the project as many suspect insiders were given an unfair advantage. These suspicions may cause Litecoin to eventually be considered an unregistered security by regulators.
Despite being one of the oldest cryptocurrencies, Litecoin is considered one of the least innovative. The Litecoin community has not been a source of major breakthroughs in the cryptocurrency space, and its developers are perceived to frequently copy updates from BTC without introducing significant innovations.
Litecoin's adoption for payments is relatively low compared to other cryptocurrencies. The lack of a substantial user base utilizing Litecoin for everyday transactions diminishes its potential as a widely accepted means of exchange.
Litecoin's primary innovation, increasing the block time from 10 minutes to 2.5 minutes, aimed to enhance capacity by a factor of four. However, similar to BTC, the Litecoin community follows a scaling strategy that avoids raising the block size. This approach limits the scalability of Litecoin as a global payments system.
Despite the increased block time, Litecoin's preference for emulating BTC's scaling strategy without raising the block size may hinder its ability to scale effectively for global payments. The limitations of this approach may become more apparent as the demand for fast and scalable transactions grows.
In comparison, Bitcoin Cash distinguishes itself by prioritizing on-chain scaling to achieve faster and more affordable transactions. While Litecoin might serve as a supplementary option in the cryptocurrency space, its lack of significant innovation, limited adoption for payments, and adherence to a scaling strategy akin to Bitcoin may impact its potential to compete as a comprehensive and globally scalable peer-to-peer electronic cash system, a goal central to Bitcoin Cash.