Charles Lee created Litecoin in 2011, and it is now the 2nd or 3rd largest digital currency after Bitcoin. For those already using Bitcoin, Litecoin has a few surprises for you. The main desktop application is an enhancement of Bitcoin-QT Client, and you can download it from Litecoin website—you can also use it as a digital wallet.
Litecoin is different from Bitcoin in some ways. To begin with, the cap for Bitcoin is 21 million coins while the cap for Litecoin is 84 million.
Litecoin has begun with a mining reward of 50 coins for every block just like Bitcoin. However, the award for Litecoin halves every 840,000 blocks which is larger than the set 210,000 for Bitcoin.
The Litecoin transaction fee is slightly higher than that of Bitcoin, but again, one Litecoin is worth 0.019BTC.
Where on earth can you get Litecoin? If you are not a miner, you have to purchase Litecoin from one of the few;
• BitBargain UK
• Bittylicious
• Bitfinex
• BTC-e
• BTER
• Kraken
• Cryptsy
• Vircurex
• CoinMKT
Litecoin is still very far from matching Bitcoin’s standards and getting merchants to accept this digital currency is not easy.
The algorithm that Litecoin uses as “proof of work” is entirely different from the one that Bitcoin does. Bitcoin uses SHA256 hashing algorithm, and Litecoin uses Scrypt algorithm. In simple terms, the Litecoin system only favors systems with a very high RAM (which is very costly), and it is a kind of “Memory Hard Problem.” Apart from that, transactions are conducted just as in Bitcoin.
The Litecoin mining process is very much similar to the Bitcoin mining process. Same with other crypto-mining, in Litecoin mining there are mining pools that increase rewards for miners.
Whether you plan to solo mine or join a pool of miners, use cgminer—it is the best mining software.
Just like cryptocurrency in general, Litecoin is not for everyone. Charles Lee in an interview said that most will use Bitcoin for expensive purchases and Litecoin for micro transactions.
