What is Litecoin?

The year 2017 is all about digital economic revolution and when we are talking about it, then how can we miss to talk about cryptocurrencies. This virtual currency came into existence in 2009, and since then we have seen the upsurge of many other currencies. The first being Bitcoin followed by others including Litecoin.

Despite being at a stage of infancy, cryptocurrencies have become a favorite way to raise funds and do the cross-border transactions. Here I will be highlighting on Litecoin which came into existence in the year 2011.

Litecoin is a peer-to-peer cryptocurrency. Creation and transfer of Litecoin are based on open source cryptographic protocol and is not managed by the central authority.  In simple words, it uses blockchain to maintain a public ledger. It is used to directly transfer the funds between business and individuals without the need of any intermediary like a bank or any payment processing service.

Here is a brief overview of the stats of Litecoin-

What Makes Litecoin different from other cryptocurrencies?

Today, the market is flooded with many cryptocurrencies with many others on their way. Amidst all this, we have Litecoin which has garnered many eyeballs. Here are the three things that make Litecoin different –

• Speed
• Number of Coins
• Market Cap

Let’s analyze this concept one by one

1. Speed – Well, the speed here refers to the speed of transactions. Developed on the same open source code as that of Bitcoin, Litecoin is a bit different from the other coins.  Since Litecoin generates blocks four times faster than the Bitcoin, it can confirm the legitimacy of transactions better.
2. Number of Coins– Cryptocurrencies are known for their limited supply which means that once the coins come into existence, then you have only that number of coins in the market, it can’t go over it at that point. Lictecoin has the maximum number of 84 million coins.
3. Market Cap- Although, Litecoin cannot compete with Bitcoin when it comes to market cap but, it still holds a position in top 5 cryptocurrencies.

How to Buy Litecoin?

The next question that pops up is how you can buy Litecoin? You can purchase it by exchanging your many cryptocurrencies like Bitcoin and Ethereum on websites known as Shapeshift and Changelly or you can buy from exchanges by spending your national or fiat currency. For example, you can buy from Coinbase in the USA and Koinex in India.

Litecoin versus Bitcoin

Although, Bitcoin is the predecessor of Litecoin, yet in some features, it outshines Bitcoin. Here is what makes Bitcoin different from Litecoin-

• When it comes to volume of the transaction, then Litecoin is a shade better than Bitcoin.
• However, this can turn out to be disadvantageous as the Litecoin Blockchain will be more significant than Bitcoin as Bitcoin leave many blocks orphaned.
• The block time of Litecoin is faster which means the lesser risk of double spending attacks.
• A merchant who would otherwise wait for 10 minutes for confirmation in case of Bitcoin, would only have to have five minutes for two approval in case of Litecoin. For example, if a merchant sells a product in exchange for some Bitcoins then he has to wait four times longer than Litecoin for payment confirmation. However, you also have the option proceed without approval.
• A total number of coins produced by Bitcoin is 21 million whereas Litecoin can produce 84 million coins. This offers a psychological advantage to the merchant but, if seen in real life situation, then things are bit different. For example, if visiting a fancy coffee shop accepting cryptocurrency, and here you buy a coffee for  $2. It would approximately cost .007 Bitcoin or 1 Litecoin.
• The fundamental difference between the two is their cryptographic algorithm. Whereas Bitcoin makes use of SHA-256 which more complicated, the Litecoin makes use of Scrypt.

The Bottom Line

Both Bitcoin and Litecoin have their space and importance in the market. Litecoin offers some advantage to the merchants as compared to the Bitcoin. Their future remains a point of discussion and concern. With ever-increasing dynamism of the market, the cryptocurrencies do hold high prospects in the times to come.