What Is Litecoin?
Litecoin is a decentralized, open-source, peer-to-peer, and fully global payment network where transactions are conducted in litecoins or LTC units. Litecoin is an alternative for bitcoin Launched in 2011 that was created using the same basic structure as Bitcoin. The brain behind the creation of Litecoin is that of Charlie Lee, MIT graduate, an ex-Google engineer.
Charlie’s initial goal behind the launch of Litecoin was to offer an improvement where Bitcoin fell short and make it up to be ‘the silver to Bitcoin’s gold.’ Based on market capitalization, Litecoin has remained among the top 10 performing cryptocurrencies ever since its inception.
Main Features of Litecoin
- Litecoin shares Bitcoin’s open-source codebase structure, with only a few differences.
- Litecoin is not backed by any government or centralized financial institutes.
- Litecoins are created through a procedure named mining, where the Litecoin network is spread across a wide pool of entities dubbed miners.
- Miners are responsible for recording all data related to transactions made over the Litecoin network into blocks. These blocks then get arranged in an orderly fashion on the blockchain so that the most recent blocks are added at the end of a chain.
- Since there is only one blockchain that all miners can access, the miners have to go through a tedious process to create a new block to maintain maximum security and avoid any manipulation of the stored data altogether.
- To create a legit block, a miner needs to encrypt it with a unique cryptographic hash, abiding by several rules.
- Once the created block passes scrutiny by mining software, it’s made visible to all miners. The miner who creates the block gets awarded with 12.5 litecoins.
- A new block is produced and added to the chain every 2.5 minutes.
- Cryptocurrencies typically have a fixed number of coins in circulation, as opposed to the infinite supply of traditional currencies.
- When a cryptocurrency becomes quite popular, the undersupply causes its value to go up. Similarly, with Litecoin, there will only ever be 84 million litecoins available for mining.
Difference between Litecoin and Bitcoin
|Coin Limit||21 million||84 million|
|Block Generation Time||Each block takes 10 minutes to generate.||Each block takes 2.5 minutes to generate.|
|Market Capitalization||$237.23 billion||$3.627 billion|
|Reward at Inception||50 BTC/block||50 LTC/block|
|Current Block Reward||6.25 BTC/block||12.5 LTC/block|
The Litecoin blockchain is capable of handling higher transaction volume than its counterpart – Bitcoin. Due to more frequent block generation, the network supports more transactions without a need to modify the software in the future.
As a result, merchants get faster confirmation times, while still having the ability to wait for more confirmations when selling bigger ticket items.
Litecoin has so much scope for growth, potential uses, and wide adoption. Right now, we must observe which companies begin adopting it and accepting transactions for their products and services. Other than that, the future of Litecoin is anyone’s guess.
How to Buy Litecoin
Litecoin is purchased through cryptocurrency exchanges the way any other crypto would be bought. However, even though there’s a larger circulating supply of LTC than BTC, you’re not guaranteed that most exchanges will have Litecoins available for purchase or trade like you may be with Bitcoin.
Litecoin can be bought directly through an exchange marketplace, or converted from digital currencies in cryptocurrency conversion services.
Create your account at your chosen exchange. You’ll need to provide a valid email address for verification and create a strong password. Put in the payment information you plan on using. This can be a checking account or your credit/debit card information.
Specify Litecoin (LTC) as the crypto you wish to buy, and then the amount of money you want to spend on it. When you buy your LTC it’s good to store it in a wallet.