XCF is the native file format used by GIMP (GNU Image Manipulation Program) for storing images. It supports layers, transparency, and a wide range of image-editing features. XCF files are ideal for complex graphic design projects and can be exported to other formats like PNG or JPG for sharing.
GIF is a graphics format that supports both static and animated images. It uses lossless compression, preserving the image quality while keeping file sizes small. GIFs are popular on social media and in web design for creating simple animations or small visual elements. However, they are limited to 256 colors.