There was a splash in inscribing Ordinals a few days ago, and Litecoin blockchain happened to process more than 1.5 million transactions in 24h, as opposed to usual 150k daily txs, which is more than Ethereum and Bitcoin did in the same timeframe. So I decided to compare these 3 most active networks in terms of transacting capabilities and real value being transferred nowadays in November 2023.
It’s gonna be 6 attributes for the analysis – speed, confirmation speed (tx finality), blockchain activity, fees, blockchain bandwidth and little bit of blockchain security (txs immutability). All the screenshots are from November 14th.
Block time of each competitor be: 10 min for Bitcoin, 2.5 min for Litecoin and 12 sec for Ethereum. All slow. Why didn’t they code 1 sec a block then? Well, for stability reasons. PoW allots time to calculate correct hash, avoid orphaned blocks and broadcast legit ones. PoS takes time to reach consensus amongst active nodes (stakers/validators) and execute smart contracts.
But speed isn’t as important as finality time. Finality time is the timespan in which merchant confirms your pending transaction. Numbers differ from merchant to merchant, let’s take a look at Coinbase tx confirmation time.
Long story short. Bitcoin does real 7-8 tps, Litecoin runs real 28-32 tps (not considering MWEB), Ethereum – 119 technically and ~40-60 realistically (because of heavy smart contract transactions and exponential fee growth).
ACTIVITY and FEES
As I said Litecoin surpassed both Ethereum and Bitcoin on 14th November. Here’s numbers from blockchair. Interesting thing is that you can see big difference in fees. It’s not zero fee for LTC transfer though, but it’s $0.01 or so.
Bitcoin simple transaction cost $4-6 right now which is 3 times more expensive than Ethereum's $1.5-2 simple tx. That’s because Bitcoin is constantly under the load, having tens, even hundreds of thousands transactions congested in its mempool (215k at the moment), which is simultaneously a good and bad thing, meaning that congested network indicates a big volume being transferred, hence high demand is there. Disregarding that ordinals surge, Litecoin has $2 billion on-chain daily volume, $30 billions on Bitcoin and $3 billions on Ethereum on average. Can tell Bitcoin is an absolute king here in volumes. Got to tell, volume numbers can be, and probably are obfuscated by funds relocation. Here’s what Bitcoin and Litecoin blocks look like on chain under the load. Bitcoin mempool and Litecoin mempool.
Let me not get into PoW vs PoS debates right now. Both security methods are backed by financial investments. So obviously Bitcoin and Ethereum, reaching the market capitalisation of 700 and 230 billion dollars respectively, are much more secure networks than Litecoin having 5 billion market cap. Therefore, if you want to buy a house for a million bucks you better do so with Bitcoin.