What are Litecoins?
Like bitcoins, litecoins are digital value tokens. They are mined through the cryptographic scrypt algorithm whereas bitcoins are mined through sha256. In the long run, there’ll be 84M litecoins mined; a far greater figure than the 21M bitcoins.
Difference between Litecoin & Bitcoin
Technically, there is little difference between the two. Litecoin has a 2.5 minute block time whereas bitcoin has 10 minute block time. Having come into the scene somewhat late, litecoin has not gathered enough speed to rival bitcoin yet.
In terms of transaction settlement speed, a protocol with a shorter block time generally needs more confirmations for the same level of security as a protocol with a longer one, and most transactions are considered ‘confirmed’ as soon as propagation has been detected (0-confirmation transaction) anyway, so a shorter block time has very little benefit.
The Scrypt algorithm used by Litecoin was intended to be ASIC (Application Specific Integrated Circuit) resistant, but ASICs are being developed for it now, eliminating the one quality that differentiated Scrypt from SHA256.
It is said by some, that if Bitcoin is gold, then Litecoin is Silver.
Litecoin is designed to be faster than Bitcoin and to prevent the centralization of mining which has occurred in the Bitcoin network through the creation of Applications Specific Integrated Circuits (ASICs).
Litecoin uses an encryption algorithm called scrypt, Bitcoin uses SHA-256.
This difference has enabled the creation of ASICs for Bitcoin, but because scrypt requires more working memory it has prevented ASICs from being developed yet.
This has meant that Litecoin is still mined on graphics cards which are widely available. ASICs are specialized, expensive, hard to get. It’s led to a less distributed mining network, which is a worrisome trend.
Considering that the litecoin network publishes a new block every 2.5 minutes against bitcoin’s 10 minutes, litecoin users enjoy better speeds of transaction-processing, increasing the maximum number of transactions per second.
Future of litecoin
Litecoin prices have not stabilized, yet. The reasons for this are far and wide. The biggest challenge that litecoin faces is acceptance from the crypto market. For some reason, bitcoins seems to be effortlessly assimilating into the market, with no hassles, and litecoin has not many people talking about it. Considering how the crypto-economy is volatile, you just can’t dismiss litecoin as a nonimportant currency. Whether it will overtake bitcoin or whether it will crash down with a thud remains to be seen