Litecoins (LTC)
Litecoin (LTC), like bitcoin, is a peer-to-peer crytocurrency that is generated by mining. Litecoin was created in October 2011 by former Google engineer Charles Lee (now, he is working for Coinbase, one of the most popular online bitcoin wallets). The purpose behind was to improve upon bitcoin, the key difference for end-users being the 2.5 minute time to generate a block, as opposed to bitcoin's 10 minutes.
Litecoin is also an open source, global payment network that is fully decentralized without any central authorities. Mathematics secures the network and empowers individuals to control their own finances. With substantial industry support, trade volume and liquidity, Litecoin is a proven medium of commerce complementary to Bitcoin. |
Litecoin Transactions - Litecoin Addresses
The Litecoin transactions, like the Bitcoin ones, require to be defined LTC addresses.
Even if LTC addresses look similar with the BTC ones, except that they usually start with "L", they cannot be mixed in transactions. Thus, for LTC transactions must be used only LTC addresses, while for BTC transactions must be used only BTC addresses.
The Litecoin network will produce 84 million Litecoins, or four times as many currency units as will be issued by the Bitcoin network.
Even if LTC addresses look similar with the BTC ones, except that they usually start with "L", they cannot be mixed in transactions. Thus, for LTC transactions must be used only LTC addresses, while for BTC transactions must be used only BTC addresses.
The Litecoin network will produce 84 million Litecoins, or four times as many currency units as will be issued by the Bitcoin network.
Main Differences Between Litecoin And Bitcoin
The main difference between litecoin and bitcoin is that litecoin can confirm transactions must faster than bitcoin. This leads to the following implications:
For miners and enthusiasts though, litecoin holds a much more important difference to bitcoin, and that is its different proof of work algorithm.
Bitcoin uses the SHA-256 hashing algorithm, which involves calculations that can be greatly accelerated in parallel processing. It is this characteristic that has given rise to the intense race in ASIC technology (technology on which the mining devices are based), and has caused an exponential increase in bitcoin's difficulty level.
Litecoin, however, uses the scrypt algorithm – originally named as s-crypt, but pronounced as 'script'. This algorithm incorporates the SHA-256 algorithm, but its calculations are much more serialised than those of SHA-256 in bitcoin.
Scrypt favours large amounts of high-speed RAM, rather than raw processing power alone. As a result, scrypt is known as a 'memory hard problem'.
The consequences of using scrypt mean that there has not been as much of an 'arms race' in litecoin (and other scrypt currencies), because there is (so far) no ASIC technology available for this algorithm.
- Litecoin can handle a higher volume of transactions due to its faster block generation
- The faster block time of litecoin reduces the risk of double spending attacks
- The Litecoin network is likely to add confirmation blocks at a rate four times faster than the Bitcoin network
- A drawback of the higher volume of blocks is that the litecoin blockchain will be proportionately larger than bitcoin one, with a higher probability of orphaned blocks.
For miners and enthusiasts though, litecoin holds a much more important difference to bitcoin, and that is its different proof of work algorithm.
Bitcoin uses the SHA-256 hashing algorithm, which involves calculations that can be greatly accelerated in parallel processing. It is this characteristic that has given rise to the intense race in ASIC technology (technology on which the mining devices are based), and has caused an exponential increase in bitcoin's difficulty level.
Litecoin, however, uses the scrypt algorithm – originally named as s-crypt, but pronounced as 'script'. This algorithm incorporates the SHA-256 algorithm, but its calculations are much more serialised than those of SHA-256 in bitcoin.
Scrypt favours large amounts of high-speed RAM, rather than raw processing power alone. As a result, scrypt is known as a 'memory hard problem'.
The consequences of using scrypt mean that there has not been as much of an 'arms race' in litecoin (and other scrypt currencies), because there is (so far) no ASIC technology available for this algorithm.