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What is Litecoin LTC? Why knowing about is important?

It is the era of innovation and an innovation is done when there’s a need. Observance of a flaw in the existing application/system/technology leads to innovation. The same thing is happening with cryptocurrencies. Since it’s inception, Bitcoin has many voids, which is being filled rapidly. While its alternatives have covered up those flaws pretty well. The innovators of Litecoin(LTC) had their own viewpoint. In this post, we will see

  • What is Litecoin (LTC)?
  • What are the benefits of Litecoin?
  • Uses of Litecoin

What is Litecoin and how does it work?

Ex-Google engineer, Charles Lee is behind creating Litecoin back in 2011. Charles noticed a margin of error hence came up with the idea of this currency. All innovations come with flaws, just like Bitcoin did. The major difference between LTC and BTC is the speed. Litecoin’s blockchain can create a block in 2.5 minutes while Bitcoin’s blockchain still takes 10 minutes to create one single block. This was the flaw that Charles notices and came up with a concept of faster cryptocurrency and names it Litecoin. BitcoinWisdom shows the block generation time for Bitcoin and Litecoin

Bitcoin difficulty vs Litecoin difficulty
  Source: BitcoinWisdom

 

Litecoin difficulty
 Source: BitcoinWisdom

For miners, Litecoin platform is a place of ease. The proof of work algorithm of Litecoin’s platform is way more cooler than Bitcoin’s. Bitcoin blockchain uses SHA-256 hashing algorithm which has properties like running calculations in parallel processing. This is the reason why Bitcoin’s difficulty level is ever increasing.

While Litecoin platform uses the scrypt algorithm, which is a better version of SHA 256 in many ways that include the calculations being more serialized. Scrypt algorithm runs on high-speed RAMs than processing it all alone. The algorithm has an upper hand in hashing power, Bitcoin has a hashing power of 20,000 terra hashes per second while LTC has only 95,642 Mega hashes a second- close to half of bitcoin.

How fast is Litecoin in terms of performance?

As reported by many, Litecoin has the capacity to perform much faster and better than Bitcoin. The implications of this are as follows:

  • With fast block generation, it can handle a higher volume of transactions. Bitcoin will need an exponential amount of changes in its code in order to match this speed.
  • The problem with the higher volume of blocks generation in the Litecoin blockchain is that a larger number of blocks will be orphan blocks. i.e. they will remain stagnant for quite a long time. As the rate of attending blocks is lower than the rate of generation of blocks.
  • Faster block time of Litecoin can help lower the risk of double spending attack.
  • If you want to carry out two transactions/confirmations in Litecoin blockchain will need to wait for 5 minutes, whereas in Bitcoin blockchain it is still 10 minutes for just one transaction/confirmation.

Transaction speed is different from confirmation speed and is indeed a moot to many out there. While many of the merchants would allow zero-confirmation transactions it is important to know that the transaction is instant only the confirmation takes time. Reason being, the transaction is carried out by the system, it has a source it has a destination and it reaches instantly, only the confirmation is done by the humans hence it takes time. And trust me, the confirmation is a tedious process, it is called Mining.

What are the uses & benefits of Litecoin?

Litecoin blockchain is a peer-to-peer internet currency that lets you do the payments to anyone in the world almost instantly. Litecoin has fast transaction confirmation times and has better storage efficiency. The Litecoin blockchain is powerful enough and can handle more transactions per second without needing to modify it in the future. Good news for merchants, as they get faster confirmation and ability to wait for more confirmations when selling bigger items.

If you have an online store, you can register your website for integrating to accept Litecoin as payment on your website. A lot of merchants have already integrated with Litecoin. If you are a trader and want to trade off the Litecoins you’ve earned all this while, finding a good Exchange it really important. Changelly is one of the best exchanges that provides best exchange rates that turns out to be profitable to you.

While the cost of sending funds on Litecoin is around $0.09 and that of Bitcoin dribbles around $7. These stats are on average and will go down or up depending on the usage of both the currencies. However, as mentioned earlier miners have a good time now. The reason why Litecoin founder could keep the transaction fee so low is the inherently higher total supply, which is because of higher hash power. There can be 84 million Litecoins whereas there can be only 21 million Bitcoins. This huge difference is the reason why Mining Litecoin is less competitive. Since Litecoin uses Scrypt algorithm, the power consumed is pretty less.

Wallets for litecoin are super safe, even when you are accessing the wallet. Ledger Nano S is the best wallet for Litecoins. It trusts nothing but the password that only you would know. You can view account balance, but to spend your Litecoins you’d need to enter the password in the wallet to complete the transaction. This way the wallet provides a sanity check before sending the payments, wallet stealing software like trojans. While the miners get 25 new Litecoins per block, and this amount gets halved every four years (every 840,000 blocks) and the Litecoin network is set to produce 84 million Litecoins which is 4 times as that of Bitcoins.

Ledger Nano S - The multi-currency hardware wallet

Conclusion

Litecoin is gaining popularity in recent times. Doesn’t matter what future looks like, but currently, Litecoin is shooting upwards and bringing good results. Litecoin is serving the purpose it ought to serve. While the currency is plunging higher, while current rate is 85.52 USD there are very high chances that it might further shoot up anytime. More than a currency, it is more of an exchanged entity. Hence it has been fruitful for many to invest in Litecoins. Since this is just a beginning, it would be unfair to comment on Litecoin’s future. As of now, Litecoin is “theoretically” better than Bitcoin.

Over to you. What do you think of Litecoin’s future? Any investments/profits from Litecoin? Let me know in the comment section below.

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Shubham Davey

Internet marketer, SEO Consultant, photographer, and blogger. The Internet is my second home, first is India. Networm and tyro.

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