There are several digital currencies in circulation all over the world, example of such currencies include Samoan tala (official currency of Samoa) and Burmese kyat (official currency of Burma). There are multiple crypto currencies just like the regular currency. The most widely known crypto currency is the bitcoin, however, litecoin is gradually gaining recognition.
WHAT IS LITECOIN
Litecoin is a peer-to-peer Internet currency that allows instant and near-zero cost payments to users in the world. Since litcoin is based on Bitcoin’s open source codebase, we should be familiar with the definition of litecoin, because the definition is similar to Bitcoin although with slight differences Litecoin’s intention was never to replace Bitcoin but to complement it.
This article will guide beginners and litecoin users to appreciate the use of this crypto currency and to sharpen their understanding of the high level of differences that exist between these two digital currencies.
HISTORY OF LITECOIN
Litecoin was released on October 7, 2011 by Charlie Lee an ex Google employee, through an open-source client on Github.
As at November 2013, Litecoin reached a $1 billion market capitalization. Its market capitalization is US$1,542,657,077 as of May 9, 2017, at around $30 per coin.
Litecoin became the first of the top-5 crypto currencies to adopt Segregated Witness in May 2017. Later that same Month, the first Lighting network transaction was completed via litecoin, transferring 0.00000001 LTC from Zurich to San Francisco in under one second.
DIFFERENCES FROM BITCOIN
Litecoin offers three major differences from Bitcoin.
• Whatever the amount of currency unit the Bitcoin network produces, the Litecoin produces four times of that amount of currency unit.
The original intended purpose of using Scrypt was to allow miners to mine both Bitcoin and Litecoin at the same time.
• The Bitcoin Network processes a block every 10 minutes, unlike the Litcoin network that processes a block every 2.5 minutes. Bitcoin developers claim that bitcoin allows for faster transaction confirmation.
• Litecoin uses scrypt in its proof-of-work algorithm, a sequential memory-hard function requiring asymptotically more memory than an algorithm which is not memory-hard.
Others differences are;
• Mining: Litecoin undergoes processor intensive unlike bitcoin which undergoes memory intensive
• Concept: Litcoin is a digital money in silver, while Bitcoin is a digital money in gold.
FUTURE OF LITECOIN
The creator of Litecoin Charlie Lee is publicly known and he actively participates in the crypto currency community unlike the anonymous creator of Bitcoin, Satoshi Nakamoto, who is unheard of, is not available to provide guidance and leadership over the technical direction of Bitcoin. Having the founder or creator of a digital currency available is important when it comes to helping others understand and rally behind Litecoin vision.
Of late, Charlie Lee is pushing for the support of adding segregated witness to Litecoin that he and his team believe will set the foundation for implementing future innovations. Segregated witness is widely recognized as an upgrade, essentially a change to the transaction data format that requires less storage space. Lighting network can be added as a support to the upgrade where transactions can quickly settle off block chain meaning not all transactions will have to go through the public ledger.
This innovative upgrade is applicable to both Bitcoin and Litecoin. However Bitcoin requires 95% of miners to support Segregated witness for activation to occur unlike Litecoin which requires only 75% miners to support the upgrade. This lower consensus threshold in addition to an active creator means that it will be easier for Litecoin to push forward this change.