What Is Litecoin (LTC)?
Litecoin (LTC) is a cryptocurrency created from a fork of the Bitcoin blockchain in 2011. It was initially designed to handle the developer’s issues that Bitcoin was turning into too centrally managed and to make it tougher for large-scale mining corporations to realize the higher hand in mining. Whereas ultimately unsuccessful in stopping enterprise miners from taking on the lion’s share of Litecoin mining, the cryptocurrency has reworked itself right into a minable coin and a peer-to-peer cost system.
Study extra about Litecoin and what makes it totally different.
Key Takeaways
- Litecoin is a cryptocurrency based in 2011, two years after Bitcoin, by a former Google engineer named Charlie Lee.
- It shares related options with Bitcoin however has a special algorithm. The cryptocurrency’s objective is to grow to be a medium for each day transactions.
- Litecoin has a quicker transaction processing time than Bitcoin.
- Though it’s a Bitcoin fork, the 2 have a number of variations.
Historical past of Litecoin (LTC)
In 2011, Bitcoin was gaining popularity with enterprise-sized miners due to its potential worth appreciation. It appeared that companies had been going to take management of mining as a result of it was rapidly turning into computationally unfeasible for people to take part.
To some, this looming centralization went in opposition to one of many unique ideas behind the cryptocurrency, that it might stay decentralized.
Charlie Lee
In a venture led by Charlie Lee, a former Google engineer, Litecoin was launched to the general public in 2011. Like Bitcoin, Litecoin is an open-source international cost community designed to be decentralized. Lee referred to Litecoin as “the silver to Bitcoin’s gold.” This assertion inferred that Litecoin was not supposed to behave as a alternative for Bitcoin however quite complement it. Like silver, it might by no means be as priceless as gold, however it might nonetheless preserve a spot as a cost methodology and be used extra.
Design
Litecoin was designed to be inaccessible to the rising community of application-specific integrated circuit (ASIC) miners who had been starting to dominate cryptocurrency mining. By implementing a special hashing algorithm that required extra reminiscence than processing energy, it was believed that profit-minded miners can be discouraged from making an attempt to centralize the cryptocurrency’s community. Nevertheless, its ASIC-resistant setup did not final lengthy: the world’s first Litecoin ASIC miners had been launched in 2014.
Mining Litecoin
You possibly can take part within the Litecoin community utilizing a private laptop, however there may be actually no profit to doing so aside from the satisfaction of being concerned except you be a part of a mining pool. Even then, your rewards might be very small as a result of swimming pools pay out rewards primarily based on the share of labor your miner does. The CPU and GPU in fashionable computer systems are usually not able to maintaining with the big mining networks that exist.
In 2024, the easiest way to mine Litecoin is by buying a number of ASIC miners appropriate with Scrypt. However even then, you may want to hitch a mining pool since you’re competing with swimming pools which can be much more environment friendly at hashing.
Shopping for and Promoting Litecoin
Most cryptocurrencies may be bought on cryptocurrency exchanges. A number of exchanges can conduct transactions inside the US; many extra are outdoors the U.S. It is vital to notice that exchanges throughout the U.S. are monitored and controlled by the Securities and Alternate Fee to make sure that the most effective pursuits of buyers and merchants are upheld. With that in thoughts, when you dwell within the U.S., your decisions are restricted to exchanges throughout the U.S.
As a result of exchanges are regulated and rules are nonetheless being developed, the locations you should purchase and promote cryptocurrencies fluctuate.
Exchanges outdoors the U.S. could or could not have regulatory authorities, though many international locations have applied controls or granted regulatory authority to their monetary regulating businesses. Some U.S. exchanges the place you should purchase Litecoin are:
- Coinbase
- eToro
- Kraken
- Binance.US
- Robinhood
- Gemini
You possibly can promote your Litecoin on the identical exchanges the place you should purchase it. Nevertheless, promoting your crypto on a centralized change is totally different than promoting it on a decentralized one. For instance, when you’re promoting your Litecoin on an change like Kraken, you may have to ship your LTC to your Kraken handle. From there, the change facilitates the gross sales of your Litecoin.
To arrange an account on considered one of these exchanges, you may have to undergo the “Know Your Customer (or client)” registration course of. This usually contains offering identification, taxpayer ID numbers, addresses, or different info that the change is required by legislation to gather. As soon as accredited, you may deposit your Litecoin and start promoting it.
Decentralized exchanges (DEX) could or could not require KYC procedures relying on the jurisdiction through which they function.
How Is Litecoin Completely different From Bitcoin?
Whereas Litecoin is a Bitcoin fork, there are various variations moreover market capitalization and worth.
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Complete coin cap of 84 million
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Makes use of Scrypt hashing algorithm
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Capability for as much as 50 transactions per second
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Block time of two.5 minutes
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Reward halves each 840,000 blocks
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Complete coin cap of 21 million
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Makes use of SHA-256 hashing algorithm
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Capability for as much as seven transactions per second
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Block time of 10 minutes
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Reward halves each 240,000 blocks
Halving Schedule
A cryptocurrency halving is an occasion through which the block rewards are minimize in half. Litecoin’s halving dates differ from Bitcoin’s as a result of it was launched two years later. The reward additionally halves at totally different intervals as a result of Litecoin produces new blocks quicker than Bitcoin.
Halving dates for LTC:
- Aug. 25, 2015: 50 to 25 LTCs
- Aug. 5, 2019: 25 to 12.5 LTCs
- Aug. 2, 2023: 12.5 to six.25 LTCs
- Mid-2027 (anticipated): 6.25 to three.125
The Way forward for Litecoin
Litecoin has moved away from a mining ecosystem dominated by particular person miners to a corporatized setup, the place massive mining swimming pools run by tech corporations account for the overwhelming majority of Litecoin mining.
Whether or not the cryptocurrency has a future relies on whether or not it’s maintained, stays related, and meets the wants of customers and buyers. As of Could 2024, it was nonetheless being maintained by a neighborhood of builders with fixes and enhancements. In 2024, Litecoin activated Runes (just like non-fungible tokens), just like the Runes out there on the Bitcoin blockchain.
It had a market worth of greater than $80, a 24-hour buying and selling quantity of about $310 million, and a market cap of $6 billion. Between January and Could 2024, the community set a document of 34 million processed transactions—almost 4 instances the quantity of transactions processed in the identical interval the earlier yr.
These developments all recommend that there’s a continued curiosity within the cryptocurrency’s future. It is eventual consequence, nevertheless, is anybody’s guess.
Does Litecoin Have a Future?
It’s tough to find out how buyers, merchants, cryptocurrency followers, governments, and most of the people will deal with Litecoin sooner or later. Cryptocurrency is being scrutinized by governments; extra cryptocurrencies are being created on daily basis, and the markets are unstable.
What Will Litecoin Be Value in 5 Years?
It is tough to foretell LTC’s market worth in 5 years. It relies on its reputation and the way people and buyers use it.
Is Litecoin a Worthy Funding?
It relies on your outlook, threat tolerance, and preferences. If you happen to get pleasure from speculating and may tolerate losses if its worth drops, it may very well be a worthwhile funding. Nevertheless, when you’re in search of a protected funding that can develop your price over time, it will not be price it. A monetary advisor may also help you resolve whether or not it’s a good funding to your circumstances.
The Backside Line
Litecoin is a blockchain and cryptocurrency supposed for use as a cost methodology. Like Bitcoin, it has additionally grow to be used as an funding and instrument for hypothesis.
You possibly can take part within the Litecoin community by downloading a shopper and turning into a miner, or you should purchase and promote it on exchanges.
The feedback, opinions, and analyses expressed on Investopedia are for informational functions on-line. Learn our warranty and liability disclaimer for more information. As of the date this text was written, the creator doesn’t personal LTC.
