Litecoin or I would say LTC is the first altcoins i.e. the alternative of bitcoin. It is a cryptocurrency that was created in 2011 by Charlie Lee who's the former engineer of Google. Although it shares some of the features of bitcoin, LTC was created to improvise the transaction speed over Bitcoin.
If you are here to know how Litecoin works, whether one should trade in Litecoin or not or what is the use of Litecoin then you are at the right place.
What Is Litecoin?
The purpose behind the creation of Litecoin is for nearly zero cost instant payments that can be exchanged worldwide between the people and the institutions.
Litecoin was created with the help of a fork in the bitcoin blockchain which is a digital and transparent public ledger used by most of the cryptocurrencies.
Owing to certain differences Litecoin is considered as a lighter and faster version of bitcoin. The difference lies in the script which is a mining algorithm used by Litecoin which enables faster transactions.
It is believed that Litecoin generates a new block every 2.5 minutes which can be mined, which is estimated to be four times faster than Bitcoin’s 10 minutes.
The supply of Litecoin is also four times greater than Bitcoin. Bitcoin has a cap of approximately 20 million coins and on the other hand, Litecoin has a cap of almost 85 million.
How Does Litecoin Work?
The same suit is followed to mine Litecoin as for Bitcoin or for any other cryptocurrencies. The proof of its work is a process that involves billions of calculations which is as follows-
Each transaction is firstly confirmed by the miners themselves who use computer hardware which must be high-power to confirm each transaction and secure it safely to the blockchain.
When a single block of the transaction is being verified, then the next block enters the chain. Transactions that are being done by using blockchain technology are generally assumed to be pseudonymous as each user has a public address.
Miners who verify their block successfully are given 12.5 Litecoin. It is similar to that of Bitcoin the no. of Litecoins given to the miner is halved.
When Was Litecoin Halving?
The reward of Litecoin in the year of its launch i.e. in 2011 was 50 Litecoins but it was halved and made 25 LTC in August 2015. Again in the year 2019, it was reduced to 12.5 from 25.
It’s assumed that this halving will keep continuing at regular intervals after every 840,000 blocks until it reaches the 84,000,000th Litecoin mining. The halvings of the LTC occurs after every 4 years due to the reason that the Litecoin blocks are mined about every 2.5 minutes.
Use of Litecoin
LTC was created for cheaper transactions which can be used more efficiently every single day. Moreover, the primary focus of the LTC is to act as a medium for transacting payments without any bank or third party’s interference.
The Takeaway
Almost a decade ago LTC came out as a result of a quasi-experiment being done by Charlie trying to be innovative with the fork of the Bitcoin blockchain. It quickly got famous worldwide.
It’s widely adopted and traded as well due to which it is amongst the top 20 cryptocurrencies. All credit goes to its use of script and a faster algorithm which has made its transaction’s speed just 2.5 minutes.
Most of the time LTC faces hurdles which had resulted in its defaming amongst the investors. Who knows what the future would bring in the way.
Written By- Riya Gulia
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