What is Litecoin (LTC)?

litecoin

Litecoin (LTC) was released as open-source on GitHub on October 7, 2011, by a former Google employeeCharlie Lee, Director of Engineering. Charlie Lee designed Litecoin by taking its core code from Bitcoin and solving some problems such as transaction times, fees, and mining pools. It is one of the oldest coins in the cryptocurrency market. Because of their similarities, Bitcoin is called “gold” in the market, while Litecoin is called “silver”. During November 2013, Its total value experienced massive growth, including a 100% jump within 24 hours. Although Litecoin uses the same protocol as Bitcoin, it has its own Blockchain network and is cheaper and faster than Bitcoin.

Features of Litecoin

Like Bitcoin, Litecoin is a peer-to-peer cryptocurrency and aims to be an important alternative in the global digital payment system. However, it is not issued by a government like all cryptocurrencies, which has historically been the only entity society has relied on to issue money. Instead, like Bitcoin, it operates on an open-source, decentralized network without a central authority. Compared to traditional currencies, Litecoin, like other cryptocurrencies, has a fixed supply. 

Litecoin is a digital currency that can be used anywhere and by anyone (except for countries that consider it illegal). It is designed in a system as simple as sending an email.

The rise in popularity of Litecoin and other cryptocurrencies is largely in response to demand for alternative currency options to differentiate themselves from central banks and governments. Investors and traders who realize the high potential that cryptocurrencies can offer make up a large part of this demand.

How Is Litecoin Mining Done?

Although there are many similarities with Bitcoin, Litecoin has some differences in terms of mining algorithms. It creates a significant advantage in favor of LTC due to differences such as fee, cost, and speed. Litecoin has a transaction cost of approximately 1/50 compared to Bitcoin. For many cryptocurrency investors and analysts, LTC pricing is more rational and more sustainable than Bitcoin.

One of Litecoin’s main goals was to keep the block confirmation time shorter than Bitcoin so that every two and a half minutes (10 minutes for Bitcoin) on its network, a block was produced to be recorded on the Blockchain network. The miners’ system verifies this block. To encourage miners, a reward mechanism has also been developed in the LTC system.

The first miner to successfully verify a block was initially rewarded with 50 Litecoins. However, as in every decentralized currency, in order to keep supply and demand in balance, halving is required in Litecoin. As it will be remembered from Bitcoin mining, the halving process is to reduce the reward paid to miners for helping block production by fifty percent. The reason for lowering the prize by half is to prevent possible inflation. Like Bitcoin halving, the Litcoin halving takes place every four years. This is to avoid the inflation that may occur in Litecoin and make it a more valuable cryptocurrency.

The Litecoin block reward, originally 50 LTC, was first reduced to 25 LTC with the halving in 2015. The second block reward halving took place on August 6, 2019, and the mining reward from 25 LTC was reduced to 12.5 LTC. Litcoin’s next block reward halving will take place in 2023.

SEE ALSO: What is SafeMoon Coin? Where to Buy It?

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Caroline Tetra

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