What is LTC / Litecoin
Bitcoin as the currency of criminals
Bitcoin was your first crypto currency and spread rapidly, including criminal activity in the Darknet (especially Silk Road). The reason for this was that the developers of Bitcoin wanted to bring a free currency to the market. Bitcoin should not provide an alternative for other digital currencies. However, the currency suffered from increasing network overload. In addition, the high fees for transactions of the simplest kind were very high.
Charlie Lee as developer of a new digital coin
Bitcoin was a thorn in Charlie Lee's side. The former Google employee and programmer of Coinbase wanted a crypto currency that is simple or lite. Lee started development and tried out cryprocurrency. The result was Fairbrix, a second generation of coins. The security was significantly better than at BTC and with the help of Tenebrix (developer: ArtForz) it should lead to an integer distribution of the currency. However, the source code had to be revised. On 13.10.2011 (only 11 days after Fairbrix) Litecoin (LTC) was created. It should be a currency in which insatiable developers could not get rich, as was the case with Bitcoin. From the outset, restrictions were placed on the number of coins. The benefits and impetus increased, for example, due to significantly lower transaction fees.
The blockchain
The blockchain of Bitcoin takes 10 minutes to generate a block, Litecoin's blockchain only 2/1/2 minutes. Not only is this digital currency faster, it also processes micro-transactions far better than its big competitor.
The use of the algorithms differ for both currencies. Bitcoin uses the hash algorithm SHA-256, which is at the expense of computing power. Litecoin has taken the Scrypt algorithm into service. To verify the transactions, not only the computing power, but also large amounts of memory come into play.
Segregated Witness
Segregated Witness (SegWit), a soft fork solution from Bitcoin Blockchain, was finally used for Litecoin to improve the LTC blockchain so that payments outside the chain are possible immediately. Scaling is about adjusting the size of the blockchain. If the blockchain is used abundantly, the block is too large, the transaction is delayed until it is stored in the blockchain. Thus, a lot of time has to be expected before the transaction is executed or a high transaction fee is charged to speed up the process or the transaction is executed without confirmation, which, however, opens the door metaphorically to fraudsters. One way to solve this problem of scalability (change of size, process or network) is the SegWit. Two approaches have an effect here:
1. The block size is not changed and yet more transfers can be performed.
2. The Lightning Network: Independent micropayment channels are used instead of the blockchain for the transactions.
The term soft fork refers to the recognition of new rules. Here it is soft or gentle changes. The rules or functions for a block are suddenly changed. A subset of the old blocks is also recognized as correct in the new version.
LTC can hold up to 84 million coins, whereas Bitcoin cannot exceed 21 million.
Litecoin today
Today, it is impossible to imagine the crypto currency without LTC and it is completely established. It is one of the oldest coins with a "long" history. Nowadays it is no longer a problem to buy or sell LTC. In addition, more and more online shops are also accepting this digital currency. Charlie Lee has achieved his goal: A lighter alternative that can certainly hold its own against BTC. In mid-May 2018, 1 LTC cost about 148 US dollars.