What is Litecoin?
Litecoin is an open source, peer-to-peer cryptocurrency project aiming to provide the world with a digital currency option. Litecoin is one of the oldest cryptocurrencies in the space using blockchain technology for transactions similar to bitcoin. Litecoin provides a better solution to digital currency transactions because it allows for faster processing times. Litecoin and bitcoin are very closely aligned. BTC uses SHA265 encryption and LTC uses Scrypt. If a flaw is found in SHA256, then LTC security would be unaffected. The same principle applies if there was an issue with scrypt. Litecoin’s practicality is to be used for more of an “everday purchase payment currency”. This is because Litecoin’s price is much lower and it has 84 million coin cap (bitcoin has 21 million). Litecoin is usually referred to as the “silver” of the digital currency world while bitcoin being the “gold”.
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Scrypt algorithm – Intended to keep ASIC miners out to better distribute hash power among the users. There is a semi-efficient ASIC implementation but it is still better distributed than Bitcoin. LTC can be mined using GPUs (AMD). Despite this, miners are still heavily invested in the coin overall.
Fast transactions – Litecoin’s blocks complete in 2.5 minute blocks while bitcoin is every 10 minutes. Instead of waiting 10 minutes per block (average but varies due to network congestion), Litecoin is only around 2.5 minutes.
Early Segwit adoption – Anti-spam transaction filter – Litecoin implemented an effective anti-spam filter very early on. Bitcoin implemented an updated fee structure which is similar to the anti-spam function but later. Litecoin was the first cryptos to implement Segwit. The segwit and anti-spam filter has both helped reduce Litecoin’s blockchain size to around 10GB which is the lowest size in all the major cryptos. To put this in perspective, bitcoin is around 165GB. (Note: Litecoin’s blockchain size may have to do with smaller transaction volume also.)
Community – Litecoin has a single unified community. Its community is full of thoughtful supporters who aren’t beating around the bush. They provide straight answers to questions and concerns. Bitcoin communities are tied between which direction they want to take bitcoin. It’s still unclear which direction bitcoin is going because developers can’t come to an agreement. (Note: This is the reason why bitcoin cash, among others, are born.)
Bitcoin clones – Spinoffs of bitcoin are another huge reason with the instability of bitcoin’s future. This is due to the fact that there are alternative views for bitcoin’s future that bitcoin developers are pushing and pulling towards. Some are not the most economically sound while others are dangerous and untested. These upgrades to bitcoin aren’t even within a specified timeframe of completion. Take into account that with every new “bitcoin” that is created is a huge conflict of interest to the core developers. They could be just “creating” new bitcoin to take advantage of its name for monetary gain.
Bitcoin upgrades – If upgrades to bitcoin such as a scalability adoption and transaction speed increase, litecoin may not even be considered a viable candidate for mass adoption. Bitcoin has the name recognition and is the face of the cryptocurrency market and people continue to talk about “bitcoin”. Many average joes, especially unfamiliar investors, always use “bitcoin” as a term for the crypto market.
Perception – Litecoin and bitcoin are practically the same thing. It’s like litecoin is living under the shadow of bitcoin, its bigger brother. They are both competing for the same space respectively; to provide a digital payment solution to the world.
Pro and Con
LTC creator sells holdings – This could be seen as both a pro and a con. Some people could think that litecoin was dumped by the creator and he is moving onto another coin. Others simply think that is was a professional move to further grow Litecoin’s maturity and gain major acceptance. Charlie Lee sold all his LTC holdings to prevent this negative criticism from skeptics. He was deemed by many to “pump” litecoin by tweeting good news and updates to his large following base in an effort to increase his monetary holdings for personal benefit. This is a huge conflict of interest which is why he decided to sell all his holdings. Charlie lee said he will be focusing on the continued development of litecoin.
Where to buy Litecoin?
Investors can buy litecoin on Coinbase and many popular exchanges such as Binance.
Litecoin seems to have a bright future ahead of it. There was recent news that litecoin has some major announcements for 2018. With the creators recent move to sell his holdings, it seems like litecoin is being set up to be adopted by big companies in the near future. While the future isn’t certain, LTC is surely setting itself up for continued success in the cryptocurrency market.