Also known as Bitcoin's little brother, Litecoin was started with a vision of making a lighter version of Bitcoin. Charlie Lee, the creator of Litecoin is an ex-employee of Google.
Litecoin was derived from Bitcoin so the easiest way to understand it is to compare the two.
- Litecoin was created on 7th of October 2011. One Litecoin is worth $210.32 (Rs 14,137 (3:22 pm IST; source: Coinmarketcap). It is one of the top five cryptocurrencies in terms of market cap.
- There is limit on how many coins can be circulated in Bitcoin, (21 million). Similarly, Litecoin's limit is 84 million.
- A block formation (processing a transaction) takes roughly 10 minutes for Bitcoin whereas it is 2.5 minutes in Litecoin.
Just like Bitcoin, Litecoin's mining is also based on proof-of-work.
Miners use their computer power to solve very difficult cryptography puzzles. The intent behind making these puzzles difficult is that the coins are mined at a steady rate and do not drain out the whole supply.
The solving might be hard, but checking it should be easy; and this checking is "proof-of-work."
Bitcoin uses an algorithm called "SHA-256" for its puzzles which requires lot of processing power.
Litecoin on the other hand, uses "Scrypt" which takes 2.5 minutes on an average to process one transaction in comparison with Bitcoin's 10 minutes.
The faster time is especially useful for merchant transactions that occur in small amount and frequently. Litecoin was designed to make it convinient to shop with.
How to buy Litecoin in India?
You can buy Litecoin buy registering with your Aadhar and PAN details on the following platforms in India:
How to store Litecoin?
Litecoin can be stored just like Bitcoin using:
- Hard (cold) wallets: These are USB kind of storage devices made especially to store cryptocurrencies offline. Trezor is one such example.
- Hot wallets desktop or mobile wallets): These are live wallets connected to the internet. These are free app based mediums.
- Paper wallets: Your cryptocurrency can be stored by printing it out on paper. It will contain you private and public key.
Why should you consider buying Litecoin?
Right now, Litecoin is much cheaper than Bitcoin (Bitcoin is almost worth 48 times more). The price is influenced by the basic economic theory of demand and supply. As previously mentioned, only 21 million bitcoins can be mined. This means its supply is restricted to 21 million, whereas Litecoin's supply is limited to 84 million.
Also, it is much more mainstream. Litecoin's founder Charlie Lee (@SatoshiLite) is very active on social media and unlike Bitcoin, it is less decentralized making it more transparent in its workings. The creators are actively working on developing and updating its features. There are instances where its features were later introduced in Bitcoin.