Launched in 2011, Litecoin is an open source cryptocurrency that is often considered as being a close cousin to Bitcoin.
Litecoin was built on Bitcoin’s code, with just a few changes made to its overall structure. Some of the most prominent changes that make Litecoin differ from Bitcoin are:
- Its decreased block time, which is two and a half minutes to Bitcoin’s 10 minutes.
- Its use of scrypt, a password-based derivation function that prevents coordinated hardware attacks.
The decreased block time makes it easier for transactions to go through faster. But that has not been tested against the same level of exertion that Bitcoin has been through in terms of large use. While Litecoin still uses a proof-of-work (PoW) consensus algorithm, the usage of scrypt makes it difficult for mining equipment manufacturers to develop expensive hardware for the platform.
Apart from this, Litecoin doesn’t really bring any major changes to the table that could make it significantly different than Bitcoin.
But even then, the cryptocurrency gained great recognition at the time of its launch. This was due to it being one of the first digital currencies to ever emerge since the debut of Bitcoin in January 2009.
In a space that was still in its formative phase, Litecoin had plenty of opportunities to expand its reach. First adopted by early supporters of cryptocurrency, the digital currency was soon known as an alternative to Bitcoin. A digital silver to Bitcoin’s gold. With a value that was lower than Bitcoin, many termed it as being the microtransactional answer to Bitcoin’s larger valued cryptocurrency.
As such, Litecoin held the distinction of being the second largest cryptocurrency for quite a while. Due to its outreach and its popularity, it is also one of those cryptocurrencies that is listed across almost all major exchanges, whether it is an exchange as large as Coinbase, or as limited yet respected as Gemini.
Litecoin was developed by Charlie Lee, who had been inspired by Bitcoin and wanted to improve upon the platform by making changes in terms of block time and other related aspects. Lee had wanted Litecoin to be adopted as a widely used cryptocurrency that could be utilized for day to day payments, with Bitcoin to still be relevant as a higher value investment or a transaction option for larger transactions.
Despite its limitations, Litecoin is still popular in the cryptocurrency community. At the time of writing, it is the 4th largest cryptocurrency in the world by market cap, being traded on a price of a little over $61.