Crypto currencies such as Bitcoin and Ethereum are currently well known even outside the crypto scene. Somewhat less known, but no less interesting, is the Litecoin. But what is Litecoin and what makes it special?
Crypto currencies such as Bitcoin and Ethereum are currently well known even outside the crypto scene. Somewhat less known, but no less interesting, is the Litecoin. But what is Litecoin and what makes it so special?
- The Litecoin was published by former Google employee Charlie Lee, who launched the currency in October 2011 and integrated it into an open source software project.
- In fact, Litecoin’s story didn’t start until November 2013.
What is Litecoin: the technical background
Technically, the Litecoin is almost identical to the Bitcoin. All transactions are managed by means of peer-to-peer. Coins can be minetted, i.e. generated, by solving blocks.
In the trading sector, the litecoin is often referred to as “crypto silver”. This term is not so wrong at all: in the litecoin network significantly more coins can be generated, which is why there are significantly more coins in circulation.
Litecoin: Faster processes, more coins
There are some serious differences to the Bitcoin. The Litecoin offers a faster payment confirmation. While processing a block takes ten minutes with the Bitcoin, it takes 2.5 minutes with the Litecoin.
Instead of SHA256, Litecoin uses scrypt in its proof-of-work algorithm. Scrypt was specially developed to make brute force attacks with special hardware more difficult, but is very memory intensive and requires a computer with a powerful graphics processor for mining.
As already mentioned before, the Litecoin network can generate significantly more coins – while the maximum number of Bitcoins is 21 million, it is 84 million for Litecoin.
Litecoin: a shadowy existence in payment transactions
If you don’t want to become a Litecoin-Miner yourself, you can buy the currency in different crypto exchanges – if available of course also with other crypto currencies as means of payment. If you want to exchange your Litecoins in return, you can do the same. Litecoin is supported by many crypto wallets, the digital counterpart of the classic wallet, so to speak.
With the Lightning Network, a solution for the scaling of crypto currencies is to be created in the medium term. Separate micropayment channels should make the transaction of coins away from the blockchain much easier. Nevertheless, the usability of Litecoin is currently still very limited. While many online shops already accept payments via Bitcoin or Ethereum, Litecoin is still a shadowy existence in this respect.