Official Litecoin logo
|1⁄1000||lites, millilitecoin, mŁ|
|1⁄1000000||microlitecoins, photons, μŁ|
|Original author(s)||Charlie Lee|
|Initial release||0.1.0 / 7 October 2011|
|Latest release||0.18.1 / 11 June 2020|
|Project fork of||Bitcoin|
|Operating system||Windows, OS X, Linux, Android|
|Developer(s)||Litecoin Core Development Team|
|Source model||Open source|
|Website||No URL found. Please specify a URL here or add one to Wikidata.|
|Block reward||12.5 LTC (approximately till August 2023), halved approximately every four years|
|Block time||2.5 minutes|
|Circulating supply||66,752,615 LTC (20 August 2021)|
|Supply limit||84,000,000 LTC|
|Exchange rate||US$126 (January 2022)|
|Market cap||US$8.7 billion (January 2022)|
Litecoin (LTC or Ł) is a peer-to-peer cryptocurrency and open-source software project released under the MIT/X11 license. Litecoin was an early bitcoin spinoff or altcoin, starting in October 2011. In technical details, Litecoin is nearly identical to Bitcoin.
By 2011, Bitcoin mining was largely performed by GPUs. This raised concern in some users that mining now had a high barrier to entry, and that CPU resources were becoming obsolete and worthless for mining. Using code from Bitcoin, a new alternative currency was created called Tenebrix (TBX). Tenebrix replaced the SHA-256 rounds in Bitcoin's mining algorithm with the scrypt function, which had been specifically designed in 2009 to be expensive to accelerate with FPGA or ASIC chips. This would allow Tenebrix to have been "GPU-resistant", and utilize the available CPU resources from bitcoin miners. Tenebrix itself was a successor project to an earlier cryptocurrency which replaced Bitcoin's issuance schedule with a constant block reward (thus creating an unlimited money supply). However, the developers included a clause in the code that would allow them to claim 7.7 million TBX for themselves at no cost, which was criticized by users. To address this, Charlie Lee, a Google employee who would later become engineering director at Coinbase, created an alternative version of Tenebrix called Fairbrix (FBX). Litecoin inherits the scrypt mining algorithm from Fairbrix, but returns to the limited money supply of Bitcoin, with other changes.
It was a source code fork of the Bitcoin Core client, differing primarily by having a decreased block generation time (2.5 minutes), increased maximum number of coins, different hashing algorithm (scrypt, instead of SHA-256), and a slightly modified GUI.
In May 2017, Litecoin became the first of the top 5 (by market cap) cryptocurrencies to adopt Segregated Witness. Later in May of the same year, the first Lightning Network transaction was completed through Litecoin, transferring 0.00000001 LTC from Zürich to San Francisco in under one second.
In 2020, PayPal added the ability for users to purchase a derivative of Litecoin along with Bitcoin, Ethereum and Bitcoin Cash which could not be withdrawn or spent as part of its Crypto feature.
In September 2021, a fake press release was published on GlobeNewswire announcing a partnership between Litecoin and Walmart. This caused the price of Litecoin to increase by around 30%, before the press release was revealed as a hoax. In February 2022, Litecoin has reached a marketcap of $8.7 Billion.
Differences from Bitcoin
Litecoin is different in some ways from Bitcoin:
- The Litecoin Network aims to process a block every 2.5 minutes, rather than Bitcoin's 10 minutes. This allows Litecoin to confirm transactions four times faster than Bitcoin.
- 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.
- Litecoin has a maximum circulating supply of 84,000,000 LTC, which is four times larger than Bitcoin's maximum circulating supply of 21,000,000 BTC.[lower-alpha 1]
Due to Litecoin's use of the scrypt algorithm, FPGA and ASIC devices made for mining Litecoin are more complicated to create and more expensive to produce than they are for Bitcoin, which uses SHA-256.
When it comes to Litecoin as a method of payment, in early days there was correlation to Bitcoin in terms of extended payment patterns. Although one might assume that payment patterns of Litecoin would converge to Bitcoin, it has been found that there is little correlation of the payment patterns of Litecoin vs Bitcoin today, and these patterns continue to diverge over time.
- The supply will approach, but never reach, ₿21 million. Issuance will permanently halt c. 2140 at ₿20,999,999.9769.: ch. 8
- renaming of mLTC/µLTC to lites/photons https://github.com/litecoin-project/litecoin/pull/375
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- Charlton, Alistair (2013-11-28). "Litecoin value leaps 100% in a day as market cap passes $1bn". International Business Times, UK Edition. Archived from the original on 2013-12-03. Retrieved 2013-12-16.
- BBC (2020) "PayPal allows Bitcoin and crypto spending", October 21. https://www.bbc.co.uk/news/technology-54630283
- Crypto with PayPal is here, PayPal.com
- "Walmart denies tieup with litecoin, fake statement rattles cryptocurrency". Reuters. 2021-09-13. Retrieved 2021-09-13.
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- Nakamoto; et al. (1 April 2016). "Bitcoin source code - amount constraints". GitHub. Archived from the original on 1 July 2018.
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- "Statement of Jennifer Shasky Calvery, Director Financial Crimes Enforcement Network United States Department of the Treasury Before the United States Senate Committee on Banking, Housing, and Urban Affairs Subcommittee on National Security and International Trade and Finance Subcommittee on Economic Policy" (PDF). fincen.gov. Financial Crimes Enforcement Network. 19 November 2013. Archived (PDF) from the original on 9 October 2016. Retrieved 1 June 2014.
- Coventry, Alex (2012-04-25). "Nooshare: A decentralized ledger of shared computational resources" (PDF). Self-published. Archived (PDF) from the original on 2013-04-20. Retrieved 2012-09-21.
These hash functions can be tuned to require rapid access a very large memory space, making them particularly hard to optimize to specialized massively parallel hardware.
- Haferkorn, Martin; Quintana Diaz, Josué Manuel (2015). Lugmayr, Artur (ed.). "Seasonality and Interconnectivity Within Cryptocurrencies - An Analysis on the Basis of Bitcoin, Litecoin and Namecoin". Enterprise Applications and Services in the Finance Industry. Lecture Notes in Business Information Processing. Cham: Springer International Publishing. 217: 106–120. doi:10.1007/978-3-319-28151-3_8. ISBN 978-3-319-28151-3. S2CID 33878873.
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