Litecoin (LTC), the silver of the crypto world

Litecoin (LTC), the silver of the crypto world

Litecoin (LTC) is one of the oldest cryptocurrencies on the market. It was launched in 2011 by former Coinbase employee Charlie Lee. The altcoin shares many similarities with the mother of all cryptocurrencies, Bitcoin (BTC), one of them being that they are both a form of digital money. In this article, we will cover both the similarities as well as the differences between the two.

As mentioned, Litecoin is very similar to Bitcoin. The altcoin has almost the same code as BTC, and both are Proof-of-Work (PoW) blockchains, but some key differences make Litecoin useful for specific use-cases. For example, many see Bitcoin as the digital gold with which people can store their value, protecting it against inflation and other unwanted influences in the world. Paying for your cup of coffee with Bitcoin, however, can be a bit of a pain. But why is this?

First of all, the block times of Bitcoin are 10 minutes which makes Bitcoin relatively slow. Secondly, Bitcoin miners use the SHA-256 algorithm to encrypt transaction data, an algorithm that is quite complex and needs a lot of energy. Litecoin implemented a different algorithm that requires a lower hash rate for miners named Scrypt. As a result, Litecoin miners need less energy and effort to process transaction blocks, increasing the block times to about 2.5 minutes.

For that reason, Litecoin is often called silver, where Bitcoin is gold. It is easier and faster to send value with Litecoin, making it better for daily transactions. Therefore, you can see Litecoin as a support for the Bitcoin network. They are, however, different projects with different goals. For example, Litecoin is working on implementing MibleWimble, a way to make private transactions possible.

Usually, by observing the blockchain, you will see which public address sent what amount of crypto to where. This is called pseudo-anonymity. With MimbleWimble, however, no one can see any meaningful transaction data. The visible data looks random, with no addresses or amounts of crypto that was sent visible. Only the participants of the transaction will be able to see any meaningful data. Litecoin wants to implement MimbleWimble to offer users a way to send private transactions and make LTC more fungible. It will, however, be an extra option. It won’t replace the way all LTC transactions are done.

Important information about the litecoin cryptocurrency

The cryptocurrency of the network has been one of the most valuable cryptocurrencies on the market for a long time. While LTC suffered during the crypto winter and the 2020 crash, litecoin managed to recover strongly together with the rest of the market.

Litecoins are born via litecoin miners. They receive LTC as a reward for their work, after which they sell it on the open market. Every four years, the amount of LTC miners receive is halved during the so-called halving event, which is the same as with Bitcoin. Litecoins maximum supply, however, is a lot bigger. Where Bitcoin has a maximum supply of 21 million, litecoin will have 84 million. This may lead to a lower price per 1 LTC, causing a possible psychological advantage compared to Bitcoin. In other words, it is cheaper to buy a whole litecoin.

Litecoin in short

To sum up, Litecoin is a blockchain network that is quite similar to Bitcoin. However, the key differences are that Litecoin is faster, cheaper, less energy-intensive, and is planning to offer private transactions with MimbleWimble. These factors make litecoin a cryptocurrency that is easier and more efficient to use for smaller daily transactions. In other words, with Litecoin, you don’t have to wait before the network confirms the payment while your coffee is getting cold!

‍

‍