Bitcoin and Litecoin are very similar, however they differ in the hash algorithm, the block interval and reward schedule. How do these characteristics impact the scalability in terms of e.g. transaction capacity, IBD, CONOP, light weight node requirements, and block verification times?
I don't understand. Litecoin doesn't use scrypt anywhere in the verification of individual transactions, as far as I can tell. Litecoin doesn't even appear to have a transaction script opcode to perform scrypt. Is it possible this comes from someone conflating "verifying transactions" with "hashing blocks"?– Nate EldredgeJun 8, 2017 at 17:59
Where did you hear this, and can you give a reference?– Nate EldredgeJun 8, 2017 at 18:06
@NateEldredge: Ah sorry, I made a mistake. It must be blocks not transactions. I had a beer with some core developers and was going from memory, don't have a written source.– Murch is on strike ♦Jun 8, 2017 at 18:30
It's certainly true that scrypt is a few orders of magnitude more expensive than SHA-256 per hash. For instance you can compare the hash rates of your favorite CPU or GPU for the two algorithms. However, the difficulty for Litecoin is more than proportionally lower, and in fact I suspect mining one Litecoin block is much easier, computationally speaking, than mining one Bitcoin block.– Nate EldredgeJun 8, 2017 at 22:00
1So, given that you have to compute one scrypt hash to determine whether a Litecoin block shows appropriate proof of work, this costs more than the corresponding computation for Bitcoin. But as a verifying node, you only have to do it once per block, and I would think this is far overshadowed by the cost of verifying all the transactions in the block.– Nate EldredgeJun 8, 2017 at 22:02
Litecoin is using largely the same consensus rules as Bitcoin with a few exceptions:
- its blockchain derives from a distinct Genesis block
- it targets a block interval of 2.5 minutes (10 minutes on Bitcoin)
- halvings happen every 840,000 blocks (210,000 on Bitcoin)
- block hashes are calculated with Scrypt instead of SHA-256d
Since the more costly Scrypt hashing algorithm needs to be only performed once per block in block validation, the effect on the IBD should be negligible compared to other steps in the validation. H/T @Nate Eldredge.
Since Litecoin has also activated segwit, its transaction capacity is roughly four times that of Bitcoin. Theoretically, this could cause Litecoin's blockchain footprint to increase at up to four times Bitcoin's rate, presumably increasing the IBD at least at the same rate. I surmise that the IBD might increase superlinearly to the blockchain footprint as it would likely correspond to a higher UTXO count as well. In practice, Litecoin is only using a fraction of its blockspace and should have a significantly faster IBD.