WikiCoin: Litecoin

  • Darryn Pollock
    📚 WikiCoin

    Litecoin aims to be silver to Bitcoin’s Gold, with faster transactions and lower fees.


WikiCoin: Litecoin

Litecoin was created by Charlie Lee in 2011, with the goal of being the silver to Bitcoin’s gold. Specifically, Litecoin was forked from Bitcoin, with the only changes being a different hashing algorithm and blocks that are mined four times faster than Bitcoin. As a result of these faster blocks, Litecoin has a maximum supply of 84 mln coins, four times as much as Bitcoin, and is less prone to congestion and high fees.

With four times as many blocks in a given time period, Litecoin has much higher transaction capacity, in terms of transactions per second, than Bitcoin. Litecoin’s supporters also point to their different hashing function, called Scrypt, as an asset. If anything ever went wrong with Bitcoin’s SHA256 algorithm, Litecoin’s network would continue to function.

Scalability

Even back in 2011, there was evidence to suggest that Bitcoin’s lack of scalability would eventually become a problem. Thus, Lee designed a currency with faster transactions and the ability to handle four times as many transactions per second as Bitcoin. Transactions sent over Litecoin’s network are roughly four times quicker than Bitcoin, with blocks being mined roughly every 2.5 minutes versus Bitcoin’s 10 minutes.

So, at the end of the day, Litecoin is a quicker option for those with time-sensitive transactions.

Google background

Litecoin was founded by a former Google employee, Charlie Lee, who is still is a prominent figure and influencer. Lee recently announced that despite still being involved in the Litecoin project, he had sold all of his coins.

Litecoin has frequently served as a kind of informal test bed for Bitcoin, with the currency adopting new features being considered for implementation on Bitcoin’s network. Last year Litecoin continued this tradition, being the first major coin to adopt Segregated Witness. Soon after, in May of last year, the first Lightning Network transaction was completed on the Litecoin network.

A lite fork

Litecoin is technically a fork of Bitcoin Core, as it broke off from the original chain on Oct. 7, 2011. The difference was the decreased block generation time because of the implementation of a different hashing algorithm.

As the scaling debate has raged on, and the need for faster transactions has grown, the value of Litecoin has grown. Always a popular coin that is usually in the top five of coins in terms of market cap, Litecoin had its first spike in November 2013 where it doubled in value in under 24 hours.

In the same year, it reached a $1 bln market cap. At press time, each Litecoin is worth $134 with a total market cap of $7.5 bln. It is currently the eighth-ranked coin by market cap.

Cover image via u.today
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About the author

Darryn Pollock is an award winning  journalist from Durban, South Africa. He picked up Vodacom’s Regional Sports Journalist Award in 2017 while expanding his Blockchain and cryptocurrency reach.  He is a contributor to Forbes, Cointelegraph, Binary District, and of course, U.Today. Darryn’s belief is that Blockchain technology will be the driving force of the next technological wave and it is the obligation of journalists and writers to tell its emerging story with integrity and pride.

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