What is Litecoin (LTC)?

  • Litecoin is a cryptocurrency that was born from a fork of Bitcoin to complement the leading cryptocurrency in the market.
  • Litecoin is considered the oldest active fork of Bitcoin

Thanks to the fact that the Bitcoin base is completely free, thousands of cryptocurrencies have been created and introduced to the crypto market.

An example of these cryptocurrencies is Litecoin (LTC), an asset that arises from a fork of BTC and with the aim that Bitcoin continue to be the gold of the crypto ecosystem, but they are silver. Designed to be faster, less expensive, and ready to tackle the day-to-day transactions that users in the world of cryptocurrencies would be willing to do.

As we discussed in our content What is Bitcoin Cash? :

“A hard fork is a permanent change in the rules of the blockchain of a cryptocurrency. Once the Hard Fork is made, the new blockchain update will not follow the rules of the old version. Any block mined with the old rules of the game, will be rejected by the new blockchain”.

What is Litecoin (LTC)?

Litecoin was founded in 2011, 3 years after the creation of Bitcoin in 2008. It was developed by Charlie Lee like a blockchain fork of the world’s first cryptocurrency, but with radical differences. Furthermore, Litecoin is considered the oldest active fork of Bitcoin.

According to the developer team behind crypto, LTC is:

“A P2P digital currency that allows instant payments at almost zero cost. Furthermore, Litecoin is an open source global payment network which, like Bitcoin, is completely decentralized … Litecoin is a means of commerce to complement Bitcoin”, Says the Litecoin team in its official website.

What makes LTC different from BTC?

Litecoin is a cryptocurrency with more in common with Bitcoin than differences, but these differences are significant.

An example of this is the time that elapses to generate a block of LTC which is much less than that of BTC that goes from 10 minutes in Bitcoin, to 2.5 minutes. In addition, Litecoin has a greater number of units available and a different mining algorithm.

Let’s delve into these differences!

SPoW consensus algorithm

One of these permanent differences that did not make the projects compatible was the change from the original mining method of Bitcoin Proof of Work (PoW) to Scrypt Proof-of-Work (SPoW), an algorithm developed in 2009, by Colin Percival.

SPoW eliminates the need to use more and more computing power when the blockchain is increasingly used. For example, in Bitcoin, the more computing power is added to the Bitcoin blockchain, the less efficient all the miners’ hardware will be. Which will require them to stack more mining machines or develop newer and better hardware.

So that, Litecoin’s algorithm change was intended to remove the incentive to stack more and more computing power as the network increased its usability and scalability.

Besides, andThis allows for the right incentives for small, independent miners to join the Litecoin ecosystem. Which in turn generates a reduction in the centralization of computing power, which is a serious problem in Bitcoin today.

2.5 minute block generation

que es litecoin bloques

This was one of the biggest changes between the two projects. Bitcoin had been criticized from day one for having great goals of becoming the alternative money of the internet, but with great limitations when it comes to transaction times and costs.

Therefore, a series of developers set out to develop alternatives to Bitcoin, which were faster when making transactions. With this in mind, altcoins such as Ethereum (ETH), Bitcoin Cash (BTC), Ripple (XRP), and the case of Litecoin (LTC) were created.

LTC migrated from Bitcoin’s 10 minute block validation time to 2.5 minutes, representing a 75% reduction in time. This means that LTC can validate about 60 transactions per second (TPS), more than 10 times faster than its predecessor Bitcoin.

In addition to the reduction of time. LTC also has lower transaction costs compared to BTC. Which have an average value of 1/1000 LTC. At an average Litecoin price of $ 53, an average transaction would cost $ 0.053 cents.

84 million LTC available

The last fundamental change that LTC had with respect to BTC, was the fact that Litecoin developers increased the maximum number of LTC units that can exist. From 21 million BTC in the case of Bitcoin to 84 million in Litecoin.

This is because the LTC developers anticipated that their cryptocurrency would not be as widely used as Bitcoin, and because they had much shorter block creation times, many of these would be left empty.

This is known as “Orphan Blocks”. So that, To avoid the loss of LTC supply in these blocks, the developers decided to substantially increase the total number of units with respect to BTC.

What do Bitcoin and Litecoin share?

que es litecoin semejanzas BTC LTC

What separates these two crypto projects has already been commented, but what unites them?

One of the common points is that both mining rewards are halved every 4 years. This phenomenon is known as Halving, and it serves so that the minting speed of cryptocurrencies is reduced by half every 4 years, being an anti-inflationary measure in certain cryptocurrencies.

Both blockchains have the characteristic of Segregated Witness. It is a feature that eliminates the necessary information in each transaction, with the objective that they occupy less space in the limited size of the blocks to be incorporated into the blockchain.. With this, more transactions can be validated per block.

Both have an option for Off Chain transactions such as The Lightning Network. The two cryptocurrencies have this characteristic, which works like a blockchain outside the blockchain, this allows to substantially increase the number of TPS that can be used, since each transaction is done practically instantly and almost at no cost. Once people decide to include their BTC or LTC to the blockchain, it is then that these transactions are validated.

Both are completely decentralized and public. So they do not depend on any company, character, regulation or law. Furthermore, it makes it impossible to censor.

Where to buy Litecoin (LTC)?

Currently LTC is one of the cryptocurrencies that make up the top 10, currently occupying the 9th position by market capitalization. What’s more, LTC is one of the most loved and respected cryptos in the crypto ecosystem, So it will not be difficult to find a place where you can buy or trade Litecoin.

But in Bitcoin Mexico we recommend move if you are in Mexican territory, or in Binance Y Coinbase if you read this anywhere in the world.

It might interest you:

We wish to thank the writer of this short article for this incredible web content

What is Litecoin (LTC)?

Dispensary Business News