Litecoin is one of the first cryptocurrencies to emerge after the inception of Bitcoin, and it is also one of the few that has managed to hold its own regarding cryptocurrency market capitalization. While most crypto-enthusiasts are aware of the existence of Litecoin, few may know how Litecoin came to be or how it has still held its position among some of the larger cryptocurrencies of today. If you are looking to learn more about Litecoin, here is an in-depth look at the history of this cryptocurrency.
When Bitcoin was first released, it attracted quite a bit of attention in the financial world. It was the first of it’s kind, and it stood unchallenged for a few years after its release as the only digital currency available on the market. That is until Litecoin was developed and released to the public.
Litecoin, also known by its abbreviated name LTC, was developed by an ex-Google employee named Charlie Lee. Lee’s goal in developing this new alternative cryptocurrency was to make a cryptocurrency that was more available to the public, with faster transaction times and lower fees and a simple user interface for those who were new to the world of cryptocurrency.
The result was launched on October 7th, 2011 and the first Litecoin block was mined when the network went live on October 13th.
Throughout its lifetime, the Litecoin network has undergone several updates, the most notable of these updates being the one that was implemented in November of 2013. It tackled many of the security issues seen by users after it was launched and the recent Segregated Witness and Lightning Network improvements that allowed the network to improve its transaction speeds to mere seconds.
Litecoin now has the 7th largest cryptocurrency market capitalization and is expecting to grow as it continues to improve itself.
Many refer to Litecoin as the silver to Bitcoin’s “gold” since it came second to the original cryptocurrency. This statement often leads people to believe that Litecoin is necessarily a creation based solely off of Bitcoin’s infrastructure. Although Litecoin was created based off a fork in Bitcoin, there are quite a few key differences that separate Litecoin from Bitcoin. Here are a few of the significant differences that set apart the two cryptocurrencies.
1. The Amount of Coins Produced By Each Network
One difference that can be spotted between the two cryptocurrencies is the total amount of coins that each network is capable of producing. While Bitcoin is limited to creating 21 million coins, Litecoin’s system is capped at 84 million coins. This difference does not provide an advantage to either coin, but it does show that the Litecoin network will continue to produce coins long after Bitcoin has reached its limit.
Another point that should be made in this section is that miners will receive greater rewards when mining Litecoin than when mining Bitcoin. Because there are fewer Bitcoins to mine and because this amount dwindles with time, Litecoin users collect more coins from mining their blocks than Bitcoin users currently do and this will remain true as both networks continue to near their coin limit.
2. Litecoin’s Faster Transaction Speeds
If you’re familiar with the technological processes behind cryptocurrencies, you know that payments are made to be instant. However, these transactions need to be approved by users operating in the network before they can be completed. In the Bitcoin network, the average time required to complete a transaction is 10 minutes or more. In the Litecoin network, users need to wait less than three minutes to see a transaction through. Transaction speeds matter and Litecoin was developed with faster transaction speeds in mind.
3. Bitcoin and Litecoin Utilize Different Mining Algorithms
Bitcoin and Litecoin miners use entirely different algorithms to mine new coins. Bitcoin miners use the SHA-256 algorithm, which is considered to be more complicated than other algorithms and requires miners to use ASIC hardware systems to mine Bitcoin. This is often seen as a negative aspect of Bitcoin due to the expense that comes with purchasing ASICs and the complexity that leaves out new and inexperienced users. Litecoin, uses an algorithm known as Scrypt, which is supposed to be ASIC-resistant and give newer users more access to the cryptocurrency. (Since it’s development, however, several companies have already made ASICs that work with the Scrypt algorithm.
For the majority of Litecoin’s life, the price of Litecoin has hovered around the $1 to $5 range. The cryptocurrency experienced a short-lived upwards trend that peaked at the end of its first year at around $45 and faced a downward trend back to its average price for the next few years. However, toward the end of 2017, the cryptocurrency jumped up to prices as high as $350 due to Bitcoin-related issues as well as the adoption of Segregated Witness and remained at these high prices for another few months. At the beginning of 2018, the price fluctuated and eventually experienced another downward trend. The current Litecoin price of one Litecoin is now at around $55. (You can the see the full price chart history here.)
Despite significant setbacks occurring in the Bitcoin space that raised the prices of Litecoin earlier last year, the Litecoin community has been rather quiet in the past couple of months, and there is not much to report concerning Litecoin news. That being said, there have been some recent developments that may affect the current price and status of Litecoin.
One of the most prominent mentions of Litecoin in recent LTC news is the anticipated adoption by the well-known Gemini exchange. This exchange, which is a product of the Winklevoss Twins, recently took to Twitter to announce that it would be adding Litecoin to its exchange on October 13th of this year. The Litecoin community believes that the addition of Litecoin to this exchange will help to improve the overall visibility of the cryptocurrency and improve both its current price as well as its adoption by new users.
Litecoin came into prominence in response to Bitcoin, and it is also one of the few coins that has managed to stay at the top despite the volatility and instability of the market. Hopefully, this guide has given you more insight into the currency itself and has allowed you to determine whether or not it may be a cryptocurrency that you would want to invest in. As always, carefully research your chosen cryptocurrency before you decide to spend and only invest what you are willing to lose.
Firstly, users need to create an account on an exchange such as Coinbase. Second, users can use fiat currency to directly buy Litecoin. If the user decides to use Coinbase, they can store their Litecoin in their digital wallet.
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