Litecoin in focus, the world's digital silver

Litecoin in focus, the world's digital silver

By Austras | Crypto in focus | 17 Sep 2021


Whenever someone or something finds success, there are others to follow. Wheter that is to build upon their legacy or simply try to steal a piece of the pie is only for time to tell. Bitcoin is called the internet's gold, Litecoin strives to be the silver to stand tall next to Bitcoin. How has the coin fared, and what does it hold in the future for this brother of Bitcoin?

Background

Litecoin is the second altcoin to be released, the first one Namecoin is mainly lost to history, stuck at sub rank 700 in marketcap. Both Litecoin and Namecoin were hard forked from Bitcoin's code, Litecoin made some changes to set itself apart from Bitcoin. The founder Charlie Lee, who was a former Google employee, changed the cap on the total coin supply as well as decreasing the fees that users pay, the smaller size and changed hash algorithm also allows for faster transactions.

The coin is often compared to Bitcoin and underestimated because of this. It has been able to perform better than a most altcoins as it has made changes to Bitcoin and offers a straight forward use case and solution. There is no revenue grabbed or given to the development team, they accept donations. However, Charlie Lee has left development leaving the coin effectively without a captain and unable to respond any relevant changes.

Network

The coin is fundamentally the same as Bitcoin, it is a hard fork after all. There is three major changes that makes this coin different. The total supply of coins is increased from 21 million to 84 million, reducing the price per coin to something that consumers might be more comfortable by (there's a great deal of people that think you have to buy an entire coin). The hashing algorithm isn't SHA-256, it uses SCRYPT instead which is less power intensive, DOGEcoin also uses SCRYPT and can be dual mined with Litecoin. This algorithm is more friendly towards CPUs and GPUs, but it is weaker leaving the coin more susceptible to 51% attacks. Lastly, the blockchain is built with a function called mimblewimble, this makes only part of transaction data visible on the public blockchain, meaning greater privacy.

Use cases

The coin was meant for either making payments or storing value in it, a digital silver if you will. It fulfils this use case better than Bitcoin in most cases as the coin has faster transactions, partly thanks to it's SCRYPT hashing algorithm but also its smaller marketcap. Smaller amount of users creates a smaller load on the network after all. It also works as a self-funding mechanism by rewarding miners in Litecoin for making the network secure. 

Litecoin today

Litecoin has been slowly but surely losing steam. This is mainly attributed to the rise of a larger amount of altcoins that are stronger. The coin also will most likely not see any new features as the founder has left the coin. It does stay safe currently from its two main threats: Bitcoin upgrading its blocksize, and Bitcoin Cash gaining traction (this sees the more plausible Litecoin killer). It does still swing and offer investors a chance to make money, but how long it will stay, is left to see.

Pros
  • Faster transactions than Bitcoin
  • Is dual-mineable with DOGEcoin
  • Easier to mine
Cons
  • Will face the same scalability issues as Bitcoin
  • Still in Bitcoin's shadow
  • Easier to attack

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Austras
Austras

Product manager & tutor, love learning & teaching others. || https://cointr.ee/dorfel


Crypto in focus
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