What is Litecoin?
In October 2011, it was launched by the author of the idea and developer Charlie Lee, who wanted to improve the system of the first cryptocurrency by using a different mining algorithm and reducing the time to confirm transactions. The “digital silver” project code was released with a free MIT / X11 license, that is, it can be modified, copied and redistributed.
Lee recently said in an interview that he took up Litecoin just to have fun, and did not expect success from him. He considers it a little less secure and decentralized compared to Bitcoin, but at the same time interesting due to lower fees, high speed and network bandwidth. Lee believes that bitcoin will be increasingly perceived as a means of preserving value, and LTC will be used for small payments.
How is Litecoin different from bitcoin?
In fact, Litecoin is a fork of bitcoin. The ease of its network allows you to confirm transactions 4 times faster than in the Bitcoin blockchain. Both systems use the Proof-of-Work consensus algorithm (PoW, proof of work), but the bitcoin uses the SHA-256 hashing algorithm, and the Litecoin uses Scrypt, which requires more RAM, but is easier to configure.
The limit for issuing bitcoin is 21 million coins, and Litecoin is 84 million coins. Each bitcoin address has 26-35 characters with the numbers 1 or 3 at the beginning of the line, and the LTC address consists of 33 characters, is formed on the basis of the public key using SHA-256 hashing and starts with the letter L or number 3 (after activating SegWit in 2017, this second type of address got its beginning in the letter M).
How to buy a Litecoin?
Litecoin can be bought on cryptocurrency exchanges, with hands or in exchangers (which is less secure) or with a credit card directly on Litecoin.com.
What is the difficulty of mining Litecoin?
Every 2016 blocks (every 4 days) in the Litecoin network, a parameter is automatically adjusted that reflects the number of computational processes necessary to find a new block, that is, the difficulty of mining a coin. This is necessary in order to save time for creating a new block within about 2.5 minutes against the background of changing mining capacities.
How to mine LTC?
Before the Chinese mining giant Bitmain introduced the ASIC miner working on the Scrypt algorithm in 2014, it was possible to mine Litecoins using central (CPUs) and graphic processors (GPUs). You can get LTC using the official project wallet or special software working on the Scrypt algorithm.
Given that the complexity of the computational tasks will be higher than with bitcoin mining, and the size of the reward for miners has recently decreased, it is extremely difficult to make money mining Litecoin without a special mining farm these days.
What is Litecoin halving?
In early August 2019, the second in a row halving took place on a block of 1,680,000 in the Litecoin network – a reduction in the size of the reward to miners for a mined network block from 25 LTC to 12.5 LTC. As Charlie Lee explained, this should prevent the LTC price from turning down.
The next similar reduction in the amount of remuneration is planned for August 2023.
Who is developing the Litecoin network?
At first, all the work related to the development of the Litecoin network was carried out by its creator Charlie Lee. At the same time, he worked at Google, and since 2013, on the American cryptocurrency exchange Coinbase, he has fully devoted himself to the project only since the summer of 2017.
In the same year, he created the non-profit organization Litecoin Foundation in Singapore and became its managing director, sharing board positions with developer and crypto investor Xinxi Wang, British developer Franklin Richards and project manager Zing Young. Litecoin Foundation financially supports the Litecoin Core development team, which includes the developers of the Litecoin project and several specialists of the organization.
In December 2017, Charlie Lee sold all his Litecoins to the Litecoin Foundation, explaining that in this way he wants to reduce his influence on the community, market and the price of the crypto asset.
Why was the SegWit fork needed on the Litecoin network?
Segregated Witness technology (“Separated Witness”, SegWit) allows you to change the block size limit by removing the signature data from the transaction. Soft fork SegWit was originally intended to increase the bandwidth of the bitcoin network. In April 2017, Litecoin did not need to solve such a problem, but nevertheless, the update was first activated on its network.
As a result, the block size on the network doubled, and in addition, according to some experts, the update contributed to a better adaptation of Litecoin compared to bitcoin and prepared LTC for the introduction of Lightning Network technology, which allows sending coins without paying commissions. As Charlie Lee later said, his project actually helped Bitcoin test SegWit.