Litecoin is the third largest cryptocurrency after Bitcoin and Ethereum. It is based on Bitcoin’s open-source database, and thus shares some of the same features as that of the Bitcoin network. Litecoin is an instant, near-zero cost payment method, which is described as a peer-to-peer digital currency. It is a global payment gateway that is opted by people all across the world. Litecoin is a fork of Bitcoin and the two are technically identical.
A blockchain is a set of continuously growing blocks that are attached one after the other. Hash pointer contains all the details of the precious blocks. It (blockchain) can record transactions that take place between the two parties, as it is an open, distributed ledger.
The Litecoin blockchain thus helps in processing a block in every 2.5 minutes and generates 25 coins in one go. It makes 14,400 Litecoins per day, and is thus considered one of the fastest cryptocurrencies in today's date. The four-fold formula of block generation results in higher transfer volume and quicker transactions. The Litecoin blockchain network has a cap of 84 million LTC coins which is four times that of Bitcoin (21 million BTC coins). The Litecoin block reward halves itself after every 840,000 blocks, as there are only 50 Litecoins issued in every new block.
A different proof-of-work hashing algorithm is followed by the Litecoin blockchain, known as Scrypt. It is a memory-intensive protocol and blocks all fraudulent activities. No old transactions can be erased from the blockchain general ledger. This makes it possible to secure any fraudulent transactions that may be created without a network consensus. A fork will be created if anyone tries to play with the network's rules in its blockchain. The Graphics Processing Unit or GPU used in the Litecoin blockchain is highly modified making it a little more expensive setup.
Due to its easy functioning and speed of transaction, many merchants and e-commerce businesses have started accepting Litecoin as a mode of payment. This makes Litecoin quite popular in the world of cryptocurrency.
In order to send Litecoin, the transactions must be verified via the Proof-of-Work protocol and the solved blocks should be included in the blockchain first. Thus miners invest their time in verifying the transactions to negate the possibility of double-transactions. For every new transaction made, miners add the same to Litecoin’s existing blockchain. By doing this verification, a miner gets a reward of 25 coins which are then added to the general ledger. Once the miner is able to collect 99 coins, it forms a new block which is then added to the blockchain. This makes Litecoin mining a profitable business.
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