Litecoin is often referred to as Bitcoin’s little brother, and Litecoin is also a digital cryptocurrency that has been received quite well since its introduction in October 2011. Litecoin is like Bitcoin, a currency that enables digital money transfers, and which with the help of a blockchain handles all transactions. in a public recumbent. The currency is used for money transfers between individuals or companies and requires no intermediary such as a bank or other service that acts as a payment intermediary.
Litecoin’s creator, a man named Charlie Lee, is a less mysterious foreground figure than the creator of Bitcoin, which goes by the pseudonym Satoshi Nakamoto. Shortly after the introduction of Bitcoin, Lee launched Litecoin, although the purpose of the currency was originally not to create an alternative cryptocurrency – a so-called altcoin. Instead, he created his currency in order to learn the code behind Bitcoin.
Above all, there are three aspects that distinguish Litecoin from other digital cryptocurrencies:
Although it’s market value fades compared to Bitcoin, at the time of writing, Litecoin is among the five most popular cryptocurrencies. The market values of the various currencies are constantly changing based on their price and the number of coins in circulation.
Although Litecoin is based on the same open-source code as Bitcoin, there are nevertheless significant differences between the two currencies. Litecoin was created to be silver in relation to Bitcoin’s gold. One of the main differences between the two is the transfer rate.
Since Litecoin creates a block about four times faster than Bitcoin, the former currency can confirm transactions significantly faster and also process them at a comparatively much faster pace.
One of the reasons why some cryptocurrencies have an actual value is their limited access. Once a certain number of litecoins (ltc) or bitcoins (btc) have been created, no more coins will be created. While Bitcoin has a limit of 21 million coins, the maximum number of litecoins in circulation will be 84 million.
The algorithm used to solve a block differs between Litecoin and Bitcoin, as well as the number of coins distributed each time a solution is discovered. When a transaction is made, it is grouped with other recently entered transactions into a block that is protected by cryptography.
The people who extract the litecoin, so-called miners, use the graphics card and/or processor power of their computers to solve complex mathematical problems. The computers send the data in a block through the hash algorithm until their total computing power detects a solution. All transactions in each block are then verified to confirm their legitimacy.
Each time a block is resolved, miners reap the fruits of their labour, as a predetermined number of coins is distributed to those who have helped. The more a miner has contributed to the work, the greater the share of coins allocated. Since today’s powerful computers are required to work for these rewards, many people often join together in so-called pools and thus combine their computing power.
As we have already mentioned, Litecoin and Bitcoin use different hash algorithms. Bitcoin uses SHA-256 (Secure Hash Algorithm 2), which is considered a bit more complex, while Litecoin uses a more memory-intensive algorithm called script. These two algorithms place different demands on hardware, and it is therefore important that the mining rig used by a miner has the right specifications for extracting litecoin. For more information about mining, and also, if you are from Sweden or Scandinavia; mining for Steem is a rising phenomenon. Visit minimining.se on how to get started!
Like Bitcoin and many other cryptocurrencies, litecoin is usually stored in a digital wallet. There are several different kinds of wallets, including software-based ones that live on your computer or mobile device, as well as physical wallets in the form of hardware. Another safe but fairly outdated and complex way to store litecoin is to create a paper wallet. The latter method involves, among other things, generating and printing a private key on a computer that is not connected to the Internet.
Each wallet has private keys required to send and receive coins from your litecoin address. As these keys are stored offline in a hardware-based wallet, they are significantly more secure than wallets connected to the Internet. These application-based wallets are available for download to computers as well as mobile devices. Computer users can also choose to install Litecoin Core, which is a full-fledged program that downloads the entire blockchain without intermediaries.
All currencies, including the Swedish krona and the gold price, have a value that corresponds to what society thinks is its true value. If, for example, too many banknotes were to be released by the Riksbank, the value of the Swedish krona would shortly afterwards plunge. This also applies not only to currencies, but also goods and services become less valuable the cheaper and more easily accessible they are. The creator of Litecoin understood from the beginning that it would be difficult for a new currency to be recognized in the market. However, by limiting the number of litecoins in circulation, he has managed to stifle all fears about currency overproduction.
There are some built-in benefits in Litecoin compared to Bitcoin. For example, Litecoin can handle more transactions because it takes less time to create a block. The currency also has a transaction fee that is so low that it is barely perceived. It takes a thousand litecoin to complete a transaction, regardless of the size of the transaction. This can be compared with PayPal’s 3 percent fee, or for that part Bitcoin’s rampant transaction fees.
Although we would like to believe that one currency has a constant value, the reality is of course another. In November 2013, Litecoin doubled its market value. Since then, the value has gradually returned to its previous level, although the number of users has increased over time. This year, however, the development of Litecoin’s market value has overshadowed Bitcoin’s deduction.
Why has Litecoin’s market value doubled over the past year? This cannot be explained by an individual event, although the growing interest in cryptocurrencies has been a contributing factor. Some investors may also be of the opinion that the price of bitcoin has become too high, which has led them to seek other investment opportunities. In addition, during the year Litecoin has become a little easier to buy, thanks to the exchange site Coinbase added to the currency in its range of cryptocurrencies.
Once a currency has gained a certain number of users who have confidence in the currency and have a belief that it will probably not lose its value, it can become a sustainable payment method. Litecoin is (like other cryptocurrencies) currently far from widely accepted – even its founder admits that it has less than 100,000 users. This is comparable to Bitcoin, a cryptocurrency that has almost half a million users worldwide. As the various cryptocurrencies reach a higher degree of acceptance by the broad masses, one or a few of these – possibly even Litecoin – will probably be established as a recognized digital currency.