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What is litecoin? (Beginners guide)
Litecoin (LTC) is a peer to peer cryptocurrency. Creation and transfer of coins is based on an open source cryptographic protocol and is not managed by any central authority. Litecoin was an early bitcoin spinoff, it was meant to be the silver to bitcoin’s gold.
Litecoin was created by “Charlie Lee”, a former Google employee and also a former engineering director at coinbase. Litecoin is third largest cryptocurrency measured by market capitalization.
Similarities between Bitcoin and litecoin
1. Both are mined i.e they both require proof-of-work.
2. They can both function as an online payment system.
3. They are limited i.e they will only ever be a maximum of 21 million bitcoin. There will also only ever be 84 million litecoin in circulation.
Differences between Bitcoin and litecoin
1. The litecoin network aims to process a block every 2.5 minutes, rather than bitcoin’s 10 minutes.
2. Litecoin uses scrypt in it’s proof of work algorithm. It is a sequential memory hard function requiring a symptotically more memory than an algorithm which is not memory-hard. Bitcoin uses SHA-256.
Due to litecoin’s use of the scrypt algorithm, FPGA and ASIC devices made for mining litecoin are more complicated to create and more expensive to produce than they are for Bitcoin.
3. Litecoin unlike Bitcoin can be mined with ordinary off-the-shelf computers. Although, the greater a machines capacity for mining, the better the chance it will earn something.
Advantages of litecoin over Bitcoin
1. Litecoin can handle more transactions given the shorter block generation time.
2. Litecoin also has a barely perceptible transaction fee.
As at the time of writing this post 1 LTC is $30. In Nigeria that is about 9,000naira. If you are looking for an altcoin to invest in, litecoin is definitely a good choice.
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