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What is Litecoin (LTC)?
Litecoin basic info
You all know what Bitcoin is. (If not, go and check out our ultimate guide to Bitcoin now) But what if I tell you there is another coin that’s just like Bitcoin but much faster and cheaper? I know there are an ever-growing number of altcoins claiming the same thing, but today, we are going to talk about one of the largest among them - Litecoin (LTC).
What is Litecoin (LTC)?
Bitcoin is epoch-making. It bred a multi-billion dollar industry and changed the way we perceive finance forever. Bitcoin is also clunky. People shy away from its long transaction time and costly transaction fees. Created from a fork of Bitcoin in 2011, Litecoin was designed to enable instant, near-zero-cost payments to everyone in the world. Like Bitcoin, Litecoin runs on thousands of nodes around the world and is not governed by any central authority. Litecoin is as much an upgrade as it is a compliment to Bitcoin. Charlie Lee, the creator of Litecoin, proclaimed it as ‘silver to Bitcoin’s gold’ during an interview in 2017. Regarding the creator of Litecoin, he is an MIT graduate and former Google engineer, Charlie Lee. Lee invented Litecoin as “mainly a fun side project” and got a job at Coinbase not long after. However, in 2017, he quit Coinbase to work on Litecoin full-time.
How does Litecoin work?
Litecoin uses Proof of Work (PoW) consensus but with a different algorithm - scrypt, shared by the famed meme coin, Dogecoin (DOGE). Similar to Bitcoin, Litecoin has a total supply of 84 million and has a halving mechanism that cuts miners’ rewards by half every 840,000 blocks.
With its similarities to Bitcoin, Litecoin is also favoured by developers to test different kinds of technologies and upgrades for Bitcoin. For example, Segregated Witness (SegWit), proposed to increase Bitcoin’s transaction speed by increasing its block size limit, was first introduced to Litecoin in May 2017, 3 months before its implementation on the Bitcoin blockchain.
Smart contracts, custom tokens, and NFTs are also available on the Litecoin blockchain with its newly-added second-layer solution OmniLite. In May 2022, Litecoin deployed the Mimblewimble protocol. This upgrade introduced better anonymity, fungibility, and scalability, as well as potentially doubled Litecoin’s transactions per second.
How is Litecoin different from Bitcoin?
Litecoin was designed to facilitate faster transactions. The average block time and the average transaction confirmation time of Litecoin are 2.5 minutes compared to Bitcoin’s 10 minutes. Litecoin is able to process around 50 transactions per second, a huge improvement over Bitcoin’s 7. Transaction fees are also much cheaper on the Litecoin blockchain, most of the time lower than US$0.01. Bitcoin’s transaction fee, on the other hand, looks like a rip-off at around US$0.5.
With the scrypt algorithm, Litecoin also intended to make mining accessible to average hobbyists, as mining Bitcoin has become more and more like a tooth-and-nail fight with heavy, loud application-specific integrated circuits (ASICs). However, scrypt ASIC miners have already been developed, and although it is still technically possible to mine LTC with consumer-grade hardware, most LTCs are mined by ASICs today. You can also merge mine DOGE together with LTC since they share the same algorithm.
Litecoin Resources
How to buy Litecoin?
Litecoin is available for purchase on most cryptocurrency exchanges, including Bitget. Check out the available LTC trading pairs on Bitget!
Futures Market
Spot Market
Buying Litecoin is easy and intuitive on Bitget:
Log in to your Bitget account and click on ‘Spot’ or ‘Futures’. Then, search ‘LTC’ and select your desired coin pair.
Enjoy our fast and easy trading experience, secured with our $300 million protection fund!
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LTC supply and tokenomics
Uniqueness
Behind Bitcoin, Litecoin is the second most popular pure cryptocurrency. This success can be largely attributed to its simplicity and clear utility benefits.
As of January 2021, Litecoin is one of the most widely accepted cryptocurrencies, and more than 2,000 merchants and stores now accept LTC across the globe.
Its main benefit comes from its speed and cost-effectiveness. Litecoin transactions are typically confirmed in just minutes, and transaction fees are nearly negligible. This makes it an attractive alternative to Bitcoin in developing countries, where transaction fees may be the deciding factor on which cryptocurrency to support.
In late 2020, Litecoin also saw the release of the MimbleWimble (MW) testnet, which is used to test Mimblewimble-based confidential transactions on Litecoin. Once this feature is available on the mainnet, Litecoin users will also benefit from greatly enhanced privacy and fungibility.
Token utility
LTC is used as a native currency within the Litecoin network. LTC can be used for peer-to-peer payments and value storage within the Litecoin network. With its faster block times, Litecoin aims to offer higher on-chain throughout and quicker confirmation times than Bitcoin. However, similar to Bitcoin, Litecoin plans to ultimately scale using layer 2 solutions such as the lightning network.
Links
What is the development prospect and future value of LTC?
The market value of LTC currently stands at $5.21B, and its market ranking is #20. The value of LTC is widely recognized by the market. When the bull market comes, the market value of LTC will likely continue to increase.
Moreover, if LTC can play a greater role in practical applications, such as Litecoin builders fully leveraging the potential of LTC, partnering with more businesses, and increasing its user base, the long-term value of LTC will be significantly enhanced.