Introduction to Litecoin
Litecoin is the brainchild of MIT graduate Charlie Lee, a former Google engineer who became interested in Bitcoin back in 2011. He noted on the Bitcointalk forum in October 2011 how he wanted to build a coin that combined the best innovations of Bitcoin and other leading cryptos. Litecoin emerged as a fork of Bitcoin’s blockchain.
Lee largely set aside his Litecoin project after joining Coinbase in 2013, but he then left Coinbase in 2017 to head back to Litecoin and focus on the coin’s development as the managing director of the non-profit Litecoin foundation.
Litecoin was originally designed to help mitigate potential Bitcoin shortcomings. For example, a Litecoin block can be mined in about 2.5 minutes compared to about 10 for Bitcoin. Litecoin also halves about every 840,000 blocks, compared to about 210,000 for Bitcoin. This design was intentional to ensure the last Litecoin is mined at about the same time the last Bitcoin is mined.
Additionally, Litecoin also has several notable enhancements that are also found on Bitcoin’s blockchain. Upgrades like Segregated Witness (SegWit) help improve scalability, while the Lightning Network builds an extra blockchain layer to facilitate fast and cheap transactions.
As of late September 2022, Litecoin’s price sits at just under $54 per coin.
What is the total supply of Litecoin?
Litecoin has an 84,000,000 coin max supply. As of late September, the circulating supply is at 71,281,406, which means about 85% of all total Litecoins have been mined.
How fast are Litecoin transactions?
The average Litecoin block time over the last few years averages about 2.5 minutes, which means transitions that need just one confirmation will take this long to process. Litecoin’s boosted processing capabilities in relation to Bitcoin enhance transaction times. The blockchain is also much less congested than other chains like Bitcoin or Ethereum.
What are Litecoin’s transaction fees?
The average transaction fee per Litecoin transaction is no greater than $0.01.
How does Litecoin work?
Litecoin operates on a Proof-of-Work (PoW) consensus mechanism. With this model, miners work to be the first to solve detailed and complicated math problems to have the right to record new blockchain transactions.
Miners who are the first to solve the hash receive a 12.5 LTC reward for their work.
Since Litecoin has a fixed supply of 84 million coins, halving events, where the miner reward is cut in half, helps control coin supply. Litecoin was originally designed as a deflationary coin but it became scarcer over time, which in theory makes the cryptocurrency more useful as an inflation hedge.
Right now, the next estimated Litecoin halving event is projected to take place in August 2023, bringing the mining reward down to 6.25 LTC per block. Halving events occur until the block reward hits 0, which is projected to occur right now in 2140.
Litecoin Hashing Algorithm
Litecoin’s hashing algorithm is known as Scrypt. An alternative to Bitcoin’s SHA-256 algorithm, Scrypt was implemented by the Litecoin team to ensure ASICs could not mine on the Litecoin network, ensuring miners with CPUs and GPUs could still be competitive.
However, ASICs have been developed that are able to mine coins that rely on Scrypt, meaning that CPUs and GPUs are at a massive disadvantage. Scrypt also helps coins have a lower hash rate than SHA-256 protocols, but Scrypt is very memory intensive as generated miner numbers are stored in the processor’s RAM.
Litecoin’s development history is filled with several notable events. In September 2014, LTC began to merge mining with Dogecoin, which increased security for the latter digital asset and offered a permanent block subside that was not previously available for Litecoin miners.
Litecoin adopted SegWit in May 2017 and conducted the first Lightning Network transaction in the same year. In 2020, PayPal added the option for users to buy a Litecoin derivative. In May 2022, the MimbleWimble upgrade came into effect as a soft fork, enabling users to send confidential Litecoin transactions.
Finally, in Summer 2022, PayPal permitted users to move Litecoin between PayPal to different wallets and exchanges.
Litecoin’s biggest advantage is its staying power, as the coin remains relatively strong despite being one of the first cryptocurrencies besides Bitcoin. It continues to grow in popularity especially as more Litecoin casinos open online.
Other advantages include faster speeds and cheaper transaction fees than Bitcoin, and the usefulness of the various tech layers added to the Litecoin blockchain that has proved to be successful.
Litecoin has also not suffered any major hacks or exploits, which has made it a coin of choice for investors interested in reliable crypto without having to worry about any ‘surprises.’ The coin is also highly liquid and inflation-controlled through its halving mechanism.
One of the biggest Litecoin disadvantages is its reliance on the Proof-of-Work algorithm, which requires massive amounts of electricity to mine and has faced harsh criticism for being too environmentally damaging.
As coins (like Ethereum) pivot to Proof-of-Stake, many surmise Litecoin might lose popularity and influence if more become concerned about the perceived negative environmental impacts of PoW. Others believe Litecoin might struggle to stay relevant in a market where decentralized finance dominates.
Additionally, solutions like the Lightning Network, while effective, might also potentially reduce the need for Litecoin as this Layer 2 infrastructure makes Bitcoin transactions much faster.
Finally, some believe the actions of Charlie Lee himself have cultivated scepticism in the coin. In 2017, Lee sold his stake in Litecoin, which led many to lose faith in the cryptocurrency. At the time, Lee was often criticized for allegedly Tweeting about the coin for his own benefit.
Crypto users interested in executing fast and cheap transactions benefit from using Litecoin. Investors who are looking for coins with staying power, resilience, and reliability also benefit from Litecoin investment, which makes the coin great for new investors looking to get used to all things crypto.
Prospective Litecoin buyers can purchase the coin after making an account on many leading exchanges, like Coinbase, Kraken, or Gemini.
You will need to make an account on a platform like an exchange, or even a Litecoin-specific app to buy the cryptocurrency. Be sure to also fund your account with enough money to buy.
Due to Litecoin’s popularity, hardware wallets like Ledger, Trezor, and BitBox all support Litecoin. Hot wallets like Edge and Exodus that are Internet-connected also support Litecoin. Of course, crypto users can also print out private keys and recovery keys and store LTC on paper wallets.
Block confirmation time is the biggest difference between the coins. Litecoin blocks take about 2.5 minutes to be mined, while Bitcoin usually takes 10. Litecoin also halves at every 840,000 blocks, while Bitcoin halves at 210,000 blocks.
Litecoin is accepted by many popular companies that also accept other coins. LTC holders can transact on platforms like Twitch, Newegg, APMEX, and even donate to organizations like the American Red Cross.
No, LTC is the Litecoin abbreviation. A litoshi is the term for the smallest Litecoin unit, which is equivalent to 0.00000001 LTC.
Litecoin’s price remains far below Bitcoin’s. LTC does move in a highly similar way to Bitcoin since Litecoin is a fork of the well-known cryptocurrency.
Final Verdict – Where is Litecoin headed?
dappGambl’s highest price prediction for Litecoin is $123 by the end of 2022. We believe the next several years will prove to be bullish for the coin, and estimate a peak trading price of at least $4,200 in 2031.
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