Launched in October 2011 by its creator Charles “Charlie” Lee, Litecoin It is one of the most popular cryptocurrencies worldwide. This digital currency is also born from a rib of Bitcoin, and precisely from the comparison with its predecessor, it is possible to identify both the common features and the peculiarities of Litecoin, which are then those on which we are interested in dwelling in detail.
The father of Litecoin (LTC), Charlie Lee, an MIT Boston graduate and former Google Inc. engineer, said in October 2011 that he was ‘playing’ with the Bitcoin (BTC) code matrix with the intention of having fun creating a branch (branch in the code).
The end result was the birth of Litecoin, a cryptocurrency based on an open source blockchain freed from the control of any central authoritywhich means that the participants in the network operate without the intermediation of banks, or credit companies and without ‘duties’ of governments or institutions.
Like all other cryptocurrencies, the basic concept is to be antagonistic and alternative to Fiat currencies, it can be used by people and/or companies for purchases of objects and transfers of funds.
Specifically, Litecoin, thanks to the speed of transactions and their profitability, can be used in the cryptographic circuit even for small value transactions. Given the initial hype, which prophesied that Litecoin would be the new silver, compared to the new digital gold of Bitcoin, LTC has become primarily an object of trading, or speculative buying and selling on market valuerather than an actual circulating currency.
How does Litecoin work and why is it different from Bitcoin?
When we talk about a cryptocurrency born as a fork of Bitcoin. Both LTC and BTC are peer-to-peer Internet currencies that operate on a global, fully decentralized and open source payment network. But, What are the main differences? Here they are listed schematically:
Price:
The first difference is the market price, also derived from the respective market capitalization. In March 2021, Bitcoin capitalized USD 1 trillion while Litecoin in the same month, with more than 66 million coins in circulation, reached just over USD 13 billion.
The value of Litecoin, at this moment (2022), is around 112 USD for 1 LTC, while for 1 BTC you need more than 38,000 US dollars. The limit of ‘mint’ coins is also significantly different, for BTC it is set at 21 million units, for LTC at 84 million.
Algorithm:
The cryptographic algorithms used to make the blockchain work are different, with Bitcoin using the older generation SHA-256 algorithm and Litecoin using a newer algorithm called Scrypt. This also leads to a gap in block generation speed, as explained in the next point.
Block speed:
Litecoin produces four times the number of blocks of Bitcoin, generating a new block every 2.5 minutes, while Bitcoin takes up to 10 minutes. The greater speed allows not only to quadruple the coin limit, but also to improve the ease of acquisition. ¿The other side of the coin? Using mining hardware, for LTC miners, requires significantly more processing power.
Is it beneficial to invest in Litecoin?
Actually, a question’with trap‘, because the cryptocurrency sector cannot be approached in a simplistic way, with a «Yeah» or a «No» absolutes as answers. Buying Litecoin, as well as investing in other digital currencies, requires an in-depth general analysis and a constant update of market trends.
It is true that certain fundamentals of Litecoin are highly appreciated by the crypto community and by financial analysts: in particular, the speed of digital transaction processing can give LTC greater possibilities of ‘real’ application as an exchange currency between users.
