Litecoin (LTC) An open source decentralized cryptocurrency created as an alternative and stable currency Bitcoin. It is 14th largest cryptocurrency By market capitalization. Litecoin aims to be a cheap and fast alternative to Bitcoin that can be easily mined. In many ways, Litecoin was the first alternative currency. We will take a closer look at Litecoin, its unique features and how it differs from Bitcoin.
Litecoin was created to be a lite version of Bitcoin hence the name Litecoin. It was created by Charlie Lee returned in 2011. Charlie Lee was then a software engineer at Google. It shares many aspects like Bitcoin Proof of work project But it is also light and fast in creating blocks and verifying transactions. Litecoin since it was created as an alternative to Bitcoin. But due to market saturation and more advanced crypto likes Etherium, It did not gain much traction.
It’s cheap and easy for me. The transaction fee is comparatively less than that of Bitcoin or Etherium. But unlike other currencies, Litecoin supply has been fixed at 84 million And there will be no more. This is done to maintain the value of Litecoin in the market. Photon is a subcoin of Litecoin Just like money is rupee. Let’s take a look at some of the unique features of Litecoin that set it apart.
Features of Litecoin
Litecoin has many facets and features that set it apart from other cryptocurrencies. It is because of these unique features that Litecoin has developed a huge community over the years. Let’s take a look at some of those features.
Script hashing algorithm
Litecoin uses evidence of work schemes where different computers compete to verify a transaction and win prizes. This is called Mining. People had to use really powerful computers in a race to see who could verify the transaction first. It doesn’t just use a lot of electricity which means that many people cannot participate in this process. Since powerful computers are not easily affordable.
So to solve this problem, a new algorithm was created Script hashing algorithm. This decentralized Litecoin even further to the point that people can mine it with their less powerful personal computer. And earn Litecoin as a reward.
Litecoin can carry 54 transactions per second. 54 transactions are not a huge amount of transactions so to achieve more transactions, Litecoin has adopted Lightning Network. It was the first cryptocurrency that Lightning Network adopted. Lightning Network is a Layer 2 protocol that helps speed up the transaction process. It allows you to make thousands of transactions in one second.
Litecoin uses a script hashing algorithm to allow a larger audience to mine Litecoin and verify transactions but it also allows people to mine another currency at the same time without using any more resources or electricity. This has given miners more incentive to mine Litecoin as they can dig up 2 coins at the same time. This is called Combined mining. Any other currency that uses scripting algorithms can be mined alongside Litecoin.
Popular meme currency Doug Also uses scripting algorithms so miners often dig it up with Litecoin to increase their earned rewards.
Bitcoin VS Litecoin
Litecoin was originally created to be a lighter and much faster version of it Bitcoin The success of Bitcoin follows. Bitcoin had a problem that we tried to overcome using the features discussed above. One of the biggest hurdles with Bitcoin is the rate at which it can add a block to its blockchain and how fast it can legalize transactions.
Bitcoin can add one block every 10 minutes. And run 7 transactions per minute.
Litecoin, on the other hand, has been able to work faster and reduce block adding speed 4 times.
Litecoin can add a block every 2.5 minutes. And run 54 transactions per minute.
Litecoin uses the Lightning network to allow thousands of transactions per second. All of this allows users to transact faster without having to pay a higher transaction fee than Bitcoin. Bitcoin transaction fees can be anywhere in between 2-10 While for Litecoin it is close 0.1-0.2.
Improved accessibility and less resource-intensive
Bitcoin uses a PoS proof of work Schemes that allow users to compete to verify transactions. Only the winner is able to get the prize. The problem with this is that it consumes a lot of resources and power and is able to conquer only the most powerful computers. Litecoin has fixed this using script algorithms and even playgrounds so that now even people on personal computers can participate in the PoS scheme.
This allows miners to dig up 2 coins at once so that they can increase their reward without using any more resources or electricity.
Money supply and market capital
Litecoin has 4 times more coin supply than Bitcoin. There is a supply of bitcoin 21 million coins And not more than that. Litecoin has a supply 84 million coins Which is 4 times more than Bitcoin. But it has also affected the price of Litecoin in the market. Bitcoin currently has the largest market capitalization and is ranked No. 1 where Litecoin is ranked 14th.
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Unwrapping the wrapper
Litecoin has opened up many new possibilities for the next altcoin. Being the first Altcoin, it has garnered a lot of support from the community and still has a growing list of supporters. It has managed to pave the way for a fast and seamless transaction experience that was not possible with Bitcoin before. We hope we’ve helped you explain Litecoin, how it works, and its features.
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