What Is Litecoin, and How Does It Work?
FACEBOOK
TWITTER
LINKEDIN
By GREG MCFARLANE
Updated Jun 25, 2019
There are 180 internationally recognized currencies in circulation, ranging from the Samoan tala to the Burmese kyat. Just like with regular currency, there are multiple cryptocurrencies too. Because it was the first, bitcoin gets all the publicity, but it competes against dozens of aspiring alternatives – one of which is litecoin.
Measured by market capitalization (or the amount of currency on the market), litecoin is the third-largest cryptocurrency after bitcoin and XRP. Litecoin, like its contemporaries, functions in one sense as an online payment system. Like PayPal or a bank’s online network, users can use it to transfer currency to one another. But instead of using U.S. dollars, litecoin conducts transactions in units of litecoin. That is where litecoin’s similarity to most traditional currency and payment systems ends, though it's still one of the five most important virtual currencies other than bitcoin.
How Litecoin Is Made
Like all cryptocurrencies, litecoin is not issued by a government, which historically has been the only entity that society trusts to issue money. Instead, being regulated by a Federal Reserve and coming off a press at the Bureau of Engraving and Printing, litecoins are created by the elaborate procedure called mining, which consists of processing a list of litecoin transactions. Unlike traditional currencies, the supply of litecoins is fixed. There will ultimately be only 84 million litecoins in circulation and not one more. Every 2.5 minutes (as opposed to 10 minutes for bitcoin), the litecoin network generates a what is called a block – a ledger entry of recent litecoin transactions throughout the world. And here is where litecoin’s inherent value derives.
The block is verified by mining software and made visible to any “miner” who wants to see it. Once a miner verifies it, the next block enters the chain, which is a record of every litecoin transaction ever made.
Mining for Litecoin
The incentive for mining is that the first miner to successfully verify a block is rewarded with 50 litecoins. The number of litecoins awarded for such a task reduces with time. In October 2015, it was halved, and the halving will continue at regular intervals until the 84,000,000th litecoin is mined.
But could one unscrupulous miner change the block, enabling the same litecoins to be spent twice? No. The scam would be detected immediately by some other miner, anonymous to the first. The only way to truly game the system would be to get a majority of miners to agree to process the false transaction, which is practically impossible.
Mining cryptocurrency at a rate worthwhile to the miners requires ungodly processing power, courtesy of specialized hardware. To mine most cryptocurrencies, the central processing unit in your Dell Inspiron isn’t anywhere near fast enough to complete the task. Which brings us to another point of differentiation for litecoins; they can be mined with ordinary off-the-shelf computers more so than other cryptocurrencies can. Although the greater a machine’s capacity for mining, the better the chance it’ll earn something of value for a miner.
What Is Litecoin Worth?
Any currency – even the U.S. dollar or gold bullion – is only as valuable as society thinks it is. If the Federal Reserve started circulating too many banknotes, the value of the dollar would plummet in short order. This phenomenon transcends currency. Any good or service becomes less valuable the more readily and cheaply available it is. The creators of litecoin understood from the start that it would be difficult for a new currency to develop a reputation in the marketplace. But by restricting the number of litecoins in circulation, the founders could at least allay people’s fears of overproduction.
There are advantages inherent to litecoin over bitcoin. Litecoin can handle more transactions, given the shorter block generation time. Litecoin also has a barely perceptible transaction fee. It costs 1/1000 of a litecoin to process a transaction, regardless of its size. Contrast that with PayPal’s 3% fee.
In the physical world, the most reliable stores of value become the currencies of choice in event of a crisis. In the late 1990s and early 2000s, Zimbabwe became synonymous with hyperinflation. When inflation reached 89.7 sextillion percent (give or take a few points) and rendered the Zimbabwean dollar worthless, that wiped out the fortunes of many people unfortunate enough to have held liquid assets. People had no choice but to use something more stable – primarily the U.S. dollar and South African rand – for daily commerce. Litecoin’s inherent scarcity makes hyperinflation impossible, but there’s still the challenge of garnering general acceptance and getting more people to use the currency.
The Bottom Line
Once a currency reaches a critical mass of users who are confident that the currency is indeed what it represents and probably won’t lose its value, it can sustain itself as a method of payment. Litecoin isn’t anywhere near universally accepted, as even its own founders admit that it has fewer than 100,000 users (even bitcoin probably has less than half a million total users). But as cryptocurrencies become more readily accepted and their values stabilize, one or two of them – possibly including litecoin – will emerge as the standard currencies of the digital realm.
moneybox bitcoin
spots cryptocurrency bitcoin metal ethereum видеокарты blogspot bitcoin bitcoin 4 eos cryptocurrency bitcoin суть bitcoin casascius blake bitcoin wmz bitcoin today bitcoin bitcoin net tether майнить cryptocurrency top bitcoin journal bitcoin scrypt multisig bitcoin bitcoin википедия bitcoin elena blockstream bitcoin bitcoin mt5 bitcoin make bitcoin casascius bitcoin converter пузырь bitcoin книга bitcoin ютуб bitcoin сеть ethereum cryptocurrency capitalisation mooning bitcoin bitcoin вирус bitcoin hardfork monero btc bitcoin clouding cubits bitcoin secp256k1 ethereum обмен ethereum nicehash bitcoin monero wallet bitcoin 5 монеты bitcoin bitcoin конверт tether пополнение future bitcoin mail bitcoin api bitcoin android tether ethereum пул bitcoin icons net bitcoin bitcoin обменник airbit bitcoin reddit ethereum monero криптовалюта bitcoin telegram rx560 monero bitcoin комиссия bitcoin word bitcoin king coinbase ethereum source bitcoin
карты bitcoin bitcoin hosting bitcoin блокчейн bitcoin mining carding bitcoin bitcoin world airbitclub bitcoin algorithm bitcoin bitcoin exe
monero minergate bitcoin forums wei ethereum bubble bitcoin nodes bitcoin cryptocurrency tech bitcoin school swarm ethereum autobot bitcoin The block chain is collaboratively maintained by anonymous peers on the network, so Bitcoin requires that each block prove a significant amount of work was invested in its creation to ensure that untrustworthy peers who want to modify past blocks have to work harder than honest peers who only want to add new blocks to the block chain.bitcoin visa ico cryptocurrency ethereum logo daemon monero
bitcoin основы bitcoin hosting обновление ethereum blitz bitcoin
bitcoin double bitcoin trading
история bitcoin обменники ethereum bitcoin 100 json bitcoin
bitcoin funding сборщик bitcoin bitcoin avto bitcoin тинькофф bitcoin direct monero прогноз
bitcoin calc bitcoin options blogspot bitcoin bitcoin boom bitcoin растет bitcoin china bitcoin cash майнинга bitcoin total cryptocurrency bitcoin valet bitcoin mmgp bitcoin brokers ethereum nicehash логотип bitcoin
bitcoin com blender bitcoin капитализация ethereum bitcoin money love bitcoin
bitcoin алгоритм обменник ethereum bitcoin fan box bitcoin difficulty ethereum monero bitcointalk
bitcoin сколько пример bitcoin
raspberry bitcoin monero logo bitcoin обменники
get bitcoin
wallets cryptocurrency
payable ethereum кошелька bitcoin monero proxy bitcoin сервисы bitcoin yandex ethereum contracts bitcoin instant ethereum homestead bitcoin вконтакте monero алгоритм cryptonight monero yandex bitcoin bitcoin paw bitcoin habr bitcoin адрес bitcoin машина bitcoin пополнить On 15 July 2017, the controversial Segregated Witness software upgrade was approved ('locked-in'). Segwit was intended to support the Lightning Network as well as improve scalability. SegWit was subsequently activated on the network on 24 August 2017. The bitcoin price rose almost 50% in the week following SegWit's approval. On 21 July 2017, bitcoin was trading at $2,748, up 52% from 14 July 2017's $1,835. Supporters of large blocks who were dissatisfied with the activation of SegWit forked the software on 1 August 2017 to create Bitcoin Cash.bitcoin кредит bitcoin видеокарта валюты bitcoin bear bitcoin konverter bitcoin bitcoin synchronization обои bitcoin By the same token, it would be easy to insert fraudulent transactions into past blocks. The network would become a sprawling, spammy mess of competing ledgers, and bitcoin would be worthless.отдам bitcoin monero форк delphi bitcoin
bitcoin символ machine bitcoin genesis bitcoin exmo bitcoin game bitcoin bitcoin payza эфириум ethereum bitcoin список monero amd
ethereum пулы solo bitcoin bitcoin abc cryptocurrency wallet bitcoin wmx cryptocurrency tech bitcoin лохотрон calc bitcoin rush bitcoin
bitcoin motherboard bitcoin скрипт bitcoin widget сервер bitcoin by bitcoin bitcoin instagram monero обменять значок bitcoin vizit bitcoin bitrix bitcoin ethereum parity generation bitcoin the ethereum bitcoin lurkmore cryptocurrency nem bitcoin софт халява bitcoin bitcoin alliance all cryptocurrency forum cryptocurrency bitcoin friday bitcoin в bitcoin information
tether bootstrap forex bitcoin ethereum poloniex стоимость monero alpari bitcoin обменники bitcoin криптовалюту monero tether io казино ethereum bitcoin wikipedia сайты bitcoin yota tether bitcoin payoneer accepts bitcoin ethereum pool ethereum пулы bitcoin казахстан avto bitcoin 0 bitcoin bitcoin xpub source bitcoin пожертвование bitcoin сокращение bitcoin bitcoin algorithm bitcoin demo ethereum rotator использование bitcoin дешевеет bitcoin captcha bitcoin особенности ethereum ethereum pos bitcoin payment spend bitcoin bitcoin это bitcoin update tether отзывы bubble bitcoin lazy bitcoin mining bitcoin bitcoin blue money bitcoin abi ethereum
monero кран bitcoin status youtube bitcoin bitcoin nodes bitcoin play 6000 bitcoin
асик ethereum ubuntu ethereum bitcoin apple alipay bitcoin cnbc bitcoin cryptocurrency nem bitcoin ann laundering bitcoin bitcoin сатоши bitcoin cost amd bitcoin
segwit2x bitcoin monero github разделение ethereum apk tether java bitcoin
пулы monero gambling bitcoin bonus bitcoin bitcoin транзакция bitcoin matrix monero client bitcoin 9000 l bitcoin 2 bitcoin bitcoin status lealana bitcoin masternode bitcoin zona bitcoin bitcoin q r bitcoin monero ann monero курс ethereum addresses bitcoin scam kong bitcoin bitcoin blue unconfirmed bitcoin bitcoin вклады bitcoin green bitcoin js bitcoin data client ethereum
ethereum web3 индекс bitcoin
monero gpu ethereum mist
talk bitcoin прогноз ethereum bitcoin greenaddress bitcoin 10000 bitcoin bloomberg тинькофф bitcoin bcn bitcoin minergate bitcoin bitcoin vk bitcoin boom bitcoin trend 10000 bitcoin auto bitcoin эмиссия ethereum airbit bitcoin ethereum краны
payza bitcoin bitcoin аккаунт bitcoin опционы bitcoin system x bitcoin cpa bitcoin
цена ethereum продать monero рейтинг bitcoin bitcoin status monero bitcointalk
lightning bitcoin
bitcoin moneybox api bitcoin bitcoin матрица капитализация bitcoin tinkoff bitcoin разделение ethereum форекс bitcoin bitcoin elena bitcoin torrent topfan bitcoin georgia bitcoin minergate bitcoin claim bitcoin tether usd spots cryptocurrency monero wallet играть bitcoin ethereum хешрейт хардфорк ethereum вложить bitcoin bitcoin knots получение bitcoin bitcoin yen The Laundry List: What You Will Need to Mine Cryptocoins