What is Litecoin?
Litecoin is designed to be a fast Cryptocurrency that offers secure and low-cost payments through the power of Blockchain technology. Having been created in 2011, it is one of the earlier Crypto developments and has more legacy/history (see below) than some of its competitors. This makes it certainly one of the earlier alt-coins; a name given to non-Bitcoin Cryptos.
As a Cryptocurrency, it was based on Bitcoin and designed to be a lighter-weight version (hence the name) with many of the same properties. Therefore it has very often been dubbed “the silver to Bitcoin’s gold.” The maximum total supply of Litecoin is 84m, 4 times that of Bitcoin. LTC aims to trade at 25% of the value of Bitcoin. Litecoin is seen as being capable of living and thriving in the same eco-system as Bitcoin and its aim is to co-exist in tandem. The creators say
“With substantial industry support, trade volume and liquidity, Litecoin is a proven medium of commerce complementary to Bitcoin.”
This certainly differentiates Litecoin from many other alt-coins that actively look to compete with other Cryptocurrencies (including Bitcoin) rather than co-exist.
The History Of Litecoin
Litecoin (LTC) went into GitHub as an open-source project on 7th October 2011, and then 5 days later it went live on the 13th October 2011. It was created by Charlie Lee (a former Google employee).
During the mid-2010s when Cryptocurrency interest was slightly fading with some merchants, Litecoin developed experimental and advanced new features like the Lightning Network (more on this below) and Segregated Witness. After initial criticism that Litecoin didn’t have a clear value proposition, these Litecoin developed features are now live on Bitcoin.
Charlie Lee the founder of Litecoin interestingly went on to work at Coinbase as a Director of Engineering from 2015 to 2017, but since then he has returned to work on the project. He is now Managing Director of the Litecoin Foundation, and also advocates Cryptos and looks to actively improve Litecoin further in this MD role.
Other notable coins, like Dogecoin, have also forked off Litecoin based on its simplicity, ease of use, and transaction speed.
Most recently in late March 2021, PayPal allowed US users to purchase and make transactions via Litecoin (alongside Bitcoin, Bitcoin Cash & Ethereum).
How Litecoin Works
Litecoin is based on a modification of the Bitcoin code, so it has many similar features. It utilizes cryptography to allow for ownership and the exchange of it as a Cryptocurrency. There is a max total supply of 84 million coins; exactly 4 times the amount of Bitcoin (21 million).
Litecoin uses proof-of-work mining to allow anyone with the right computing hardware to add new blocks to the Litecoin Blockchain, and when they do so to earn the new Litecoin that this creates.
Where Litecoin differentiates itself from Bitcoin is with the average amount of time to mine a block (4 times faster at around 2.5 minutes vs Bitcoin’s 10 minutes). A different mining algorithm is also used. While Litecoin can be mined much faster than Bitcoin, the mining market is still dominated by large-scale operations.
The key benefit Litecoin provides is that it can finalize transactions much faster than Bitcoin. This also helps to keep the costs of Litecoin transactions low; a very attractive property in a Cryptocurrency and an even more important factor for developing countries when they may look to adopt and use Cryptocurrencies.
It can also benefit from the Lightning Network, which in May 2017 allowed for a small transaction (roughly 1.3 US cents) to be sent from Zurich to San Francisco in under 1 second. This also displayed that this Cryptocurrency can use a layered network design. As Cryptocurrencies become more widespread and global, this will become a more useful and desired property.
In late 2020 the launch of the MimbleWimble (MW) testnet provided much more enhanced privacy and fungibility to Litecoin too.
So now you know what Litecoin is, if you’re looking for where to buy Litecoin, the team at Complete Crypto has reviewed the best Litecoin Exchanges for you here.