What is Litecoin (LTC): Basic guide to the veteran altcoin

ProductDec 09, 2022
What is Litecoin (LTC): Basic guide to the veteran altcoin

The cryptocurrency of the Litecoin blockchain, dubbed "the silver to Bitcoin's gold," is one of the first altcoins. Over a decade after its launch, LTC is still among the largest peer-to-peer cryptos by market capitalization. Learn more about this seasoned digital asset in our guide.

What is LTC?

The Litecoin whitepaper describes LTC as a "peer-to-peer Internet currency that enables instant, near-zero cost payments to anyone in the world" with the potential to become a "proven medium of commerce complementary to Bitcoin."

Like Bitcoin, the LTC blockchain uses open-source blockchain technology based on mining and Proof of Work. The main technical similarities include the following:

  • recording all transactions in a public and decentralized ledger
  • absence of centralized control
  • mining
  • Segregated Witness (SegWit)

Miners process new transactions on the Litecoin blockchain and add them into blocks. Meanwhile, the operator of each node maintains a copy of the blockchain to prevent discrepancies in transaction history. The latter is accessible via a Litecoin explorer like Blockchair.

Blockchair LTC explorer. Source: Blockchair
Blockchair LTC explorer. Source: Blockchair

Litecoin as a testnet for Bitcoin

Litecoin has repeatedly served as a "testnet" for the blockchain pioneer. For example, in 2017, it processed the first Lightning transaction before the Lightning Network – a second-layer technology with micropayment channels for payments – was integrated into Bitcoin.

Segregated Witness (SegWit) minimizes the occurrence of orphaned blocks. Bitcoin adopted this feature after its successful implementation on Litecoin. SegWit prevents a situation when two miners mine valid blocks simultaneously, and the chain initially accepts both before rejecting one of them – an orphaned block.

Litecoin vs. Bitcoin: Key differences

The LTC crypto has important distinctions and advantages over Bitcoin. These features have helped it succeed and remain one of the top digital assets.

  • Atomic Swaps adds interoperability – users may trade multiple cryptocurrencies without the need for exchange.
  • The total LTC coin supply is four times that of BTC – 84 million LTC.
  • The average fees to send Litecoin are lower – around $0.0070 per transaction, compared to $0.957 on Bitcoin.
  • Transactions are faster. Mining one LTC block takes 2.5 minutes instead of 10 minutes for a block on Bitcoin.
  • LTC uses another hashing algorithm – Scrypt (pronounced es-crypt), which consumes less energy and computational power than Bitcoin's SHA-256.

Due to the use of Scrypt, Litecoin's consensus model is slightly different from Bitcoin's. Due to lower energy consumption, it enables mining with consumer-grade hardware, making it more accessible to the general public.

Security advantages of LTC crypto

Scrypt is a cryptographic key-derivation function (KDF) providing enhanced protection from hardware brute-force attacks. It makes Litecoin less susceptible to application-specific circuits (ASICs), one of Bitcoin's alleged early vulnerabilities. The downside is a significant memory requirement.

Since 2011, the Litecoin blockchain has avoided any significant exploits. It has also proven secure against 51% attacks, in which malevolent mining entities take over half of all computing power to tamper with the blockchain's history.

Basic comparison of BTC and LTC. Source: Investopedia
Basic comparison of BTC and LTC. Source: Investopedia

Litecoin history

Litecoin was launched on October 13, 2011. Its creator Charlie Lee is a Massachusetts Institute of Technology graduate and a former Google engineer. Lee's goal was "to make a coin that is silver to Bitcoin's gold" based on the best crypto innovations available. He had come up with the concept while working on a fork of the Bitcoin blockchain. Initially, it was "mainly a fun side project."

In 2013, as the director of engineering at Coinbase, Lee focused on helping people "own Bitcoin and hold Bitcoin," but he eventually returned to full-time LTC development in 2017. Today, he is the director of the Litecoin Foundation, a non-profit committed to advancing LTC "for the good of society by developing and promoting state-of-the-art blockchain technologies." This company is registered in Singapore.

How many litecoins are there?

LTC emerged with a modest premine – the genesis block and two validity-confirming blocks contained 150 coins. The premine allowed creators to mine coins before the public launch as a reward and funding method.

Here are some basic facts about the LTC supply, which affects the Litecoin price, as of December 7, 2022:

  • The total supply of LTC is capped at 84 million coins.
  • The blockchain generates a new block every 2.5 minutes.
  • With over 71.7 million LTC already mined, around 13.3 million coins are yet to enter circulation.
  • The LTC mining reward has decreased from 50 LTC to 12.5 LTC per block as a result of Litecoin halving. Halving events occur after every 840,000 blocks or roughly every four years. The last block is expected to be mined in 2142.

How much is Litecoin worth?

As of this writing, the LTC/USD pair is trading at $76.84 with a 24-hour change of -3.0%, a 30-day climb of +13.1%, and a 12-month loss of -52.7%. The cryptocurrency is in 14th position by market cap (just over $5.4 billion), behind DOT but ahead of DAI.

Litecoin to USD chart. Source: Coingecko
Litecoin to USD chart. Source: Coingecko

Throughout Litecoin's price history, peaks have alternated with long sideways periods. In December 2017, the LTC price soared above $350 after Lee revealed he was selling and donating all of his LTC. Then, $LTC reached an all-time high of $410.26 on May 10, 2021.

While the current price of 1 LTC to USD is 81.3% below the Litecoin all-time high, it is also $6,588% above the lowest point of $1.15 on January 14, 2015. You can use an LTC price calculator before converting any amount of LTC to USD and back.

As of December 7, 2022, the latest LTC crypto news considers the likelihood of a rise to $100 following a breakout move in October 2022. This uptrend lost momentum due to the FTX's downfall but later resumed, supporting Cointelegraph's Litecoin price prediction.

What is Litecoin used for?

Litecoin was devised as a borderless payment system for peer-to-peer (P2P) transactions. It aimed to speed up payments, giving merchants a more convenient method than BTC.

Additionally, LTC is commonly found in diversified crypto portfolios. Investors and traders speculate on its price, which relies on the limited supply and reductions in issuance. These factors are crucial for any LTC price prediction.

You can buy and sell LTC on major crypto exchanges – for example, by converting LTC to BTC, LTC to XMR, or USD to LTC. Users can buy Litecoin with PayPal, a credit card, and other popular methods. They can also stake LTC on platforms like Binance.

LTC directory. Source: Cryptwerk
LTC directory. Source: Cryptwerk

How to mine Litecoin

Instead of the most powerful option – ASIC mining hardware with pre-installed software – some miners use a central processing unit (CPU) or graphical processing unit (GPU) with a program of their choice. However, both alternatives come with security concerns.

Mining LTC alone is rewarding but also demanding in terms of hash power. Solo miners may spend months before discovering a block, and the chances of mining LTC with the help of a GPU or CPU are slim to none.

You can use this Litecoin calculator USD to determine potential profit based on hash rate, power parameters, network difficulty, and the price of Litecoin. Solo miners keep the entire mining rewards plus fees, while mining pools use two types of reward systems:

  • Proportional – the reward for each block, once it is found, is distributed among all users proportionally to the number of shares submitted.
  • Pay-per-share – each user gets a fixed amount of LTC for each valid share submitted, based on the number of blocks expected to be found based on the volume of collective work.

How to buy Litecoin

Instead of mining LTC, one can get it through a trusted crypto platform. For example, users of major exchanges can buy Litecoin instantly after setting up an account and topping up the balance. Thanks to multiple fiat gateways, it is possible to buy Litecoin with a debit card or credit card, via a bank transfer, SEPA, and more, depending on the platform.

Exploring Litecoin potential on CoinLoan

You can buy Litecoin quickly and easily on CoinLoan, a licensed and regulated crypto-lending platform. Swap other assets for the "silver to Bitcoin's gold" or transfer funds from your Litecoin wallet to use our Loans, Interest Account, or Exchange.

We offer an intuitive all-in-one interface where you can make the most of the Litecoin value. Borrow, buy, deposit, or collateralize cryptocurrencies in a few clicks or taps! Here are three use cases for your LTC wallet on CoinLoan.

Get an LTC loan or borrow against LTC

We accept Litecoin both as a loan currency and collateral. CoinLoaners can borrow the coin against other cryptocurrencies, stablecoins, or fiat, or get loans backed by LTC value.

Choose a convenient term from one month to three years – you can always take advantage of our partial repayment feature. Our LTV rates are also flexible (20%–70%) to suit different risk tolerance levels.

Earn Litecoin interest

Regardless of LTC predictions, you can earn a stable yield by keeping your coins on CoinLoan. Move them from your wallet LTC to Interest Account to unlock one of our APY options:

  • 5.2% APY on LTC
  • 7.2% APY on LTC with CLT Staking

Exchange LTC

Convert LTC to BTC or BTC to LTC, and explore 200+ trading pairs on our trusted Exchange. Users can buy LTC or swap it for other cryptocurrencies, stablecoins, or fiat. Whether you need ETH/LTC, USDT/LTC, or EUR/LTC, we have you covered.

Conversion via our LTC calculator is hassle-free – choose the ticker symbols from the drop-down menus, enter the desired amount in either field, and press Exchange!

Final word

Litecoin is one of the oldest cryptocurrencies that has been around since 2011. This mineable digital asset is similar to Bitcoin, but it also solves some of its shortcomings, like slow processing of transactions. Keep track of Litecoin news and take advantage of this veteran cryptocurrency on CoinLoan: buy, borrow, deposit, or collateralize it in seconds!  

Disclaimer:

The information provided by CoinLoan (“we,” “us,” or “our”) in this text is for general informational purposes only. All investment and financial opinions expressed by CoinLoan in this text are from the personal research and open information sources and are intended as educational material. All outlined information is provided in good faith. However, we make no representation or warranty of any kind, express or implied, regarding the accuracy, adequacy, validity, reliability, availability, or completeness of any information in this text.

Like the article? Spread the word!
We use cookies to provide the best services. Cookies are subject to our Privacy Policy.