Litecoin ExposédJuly 02, 2015

Born: Oct 7, 2011 3:31am
Mining Limit: 84 Million
Block Target: 150 seconds
Mining Rate: 50 coins/block
Rate Halving: Every 840,000 blocks

(at time of publishing)
Price: $4 - $4.10 USD
Litecoin Supply: 40.4 Million
Transactions Rate: 6,000/day
Network Hashrate: 1.2 TH/s (scrypt)

The Contender

Litecoin's mining reward will be cut in half within two months. This event marks the point where 50% of the total litecoin will be in circulation. After the mining reward is reduced, the cost to mine each litecoin will effectively double, driving up the price. Litecoin offers little advantage over bitcoin, but it has always been a front-runner among cryptocurrencies. Market price is in a particularly volitile state this summer, which is excellent news for day traders.

Features

Litecoin is identical to bitcoin with a few minor changes. Blocks are generated every 2½ minutes, which accelerates transaction confirmations. This faster block generation allows four times the transactions per hour (vs bitcoin). The most notable difference is that litecoin uses a scrypt-based algorithm for mining, versus the SHA-256d of bitcoin. ASIC mining hardware designed for bitcoin is not compatible with litecoin's scrypt algorithm. This segregates the hashing power of the litecoin and bitcoin blockchains.

History

Started by Charles Lee in 2011, litecoin quickly became a leading alternative to bitcoin. Litecoin's popularity is partially due to Lee's focus on fairness. Wallet binaries and source code were provided three days prior to launch, allowing everyone an equal mining opportunity. With an intermediate price, many exchanges utilized Litecoin to bridge the gap between expensive bitcoin, and low value altcoins.

Development

Litecoin does an excellent job at keeping up with bitcoin core code. The latest official release is based on the current bitcoin core 0.10. Litecoin has a few minor bugfixes which were rejected by bitcoin. The recent transaction spam attack on the bitcoin blockchain would not have been feasible on litecoin as elaborated by Charles Lee (coblee).

The android wallet is functional, but has not been updated recently. It is missing one essential security feature, which the bitcoin wallet added several months ago, a pin-lock when sending transactions. Without this feature, only the phone's built-in security is protecting your litecoins from being stolen by anyone with access to your phone.

Market Activity


With slightly under two months before the first mining reward halving, market interest in litecoin has hit an all-time high. The price has shot up from a low around $1.30 USD (0.006 BTC), to over $4 USD (0.016 BTC) during the last five weeks. Millions of litecoin have been traded in the recent weeks. Some of the market activity may be due to the financial difficulties that Greece has been suffering. Many people around the world are looking for alternative forms of investments, and litecoin appears to be a viable option for many investors. The price has been on a rising steadily, and is expected to continue increasing as we approach the end of August.

Rating

Overall Score: 

86 FairLaunch™ Grade: S
Time PeriodTargetLTC Mined% of Max LTC (84M)
Premine01500.0000%
24 Hour28,800504,5500.0060%
14 Days403,200980,5500.0117%
Instamine0577,3500.0069%
*Instamine = First 14-Day LTC Mined - Computed Target
Development Grade: B
Desktop wallet code is updated very frequently.
No groundbreaking features.
Android wallet needs a pin-lock feature.
Usability Grade: B
Leading the way with merchant adoption.
Litecoin offers fast block times, and enormous hashrate.
No blockchain problems or major code changes.
Liquidity Grade: B
While litecoin has the market capacity to support very large transactions, it could not yet support a multi-million dollar purchase without crashing the market.

Conclusion

Litecoin is an excellent alternative to bitcoin. The wallet code is updated frequently, and the blockchain has had no major issues in its nearly four-year history. The main driving factors in the market price are speculation over litecoin's first mining reward halving, and currency instability in countries like Greece.

The increase in price has not been without resistance. Each time the price rose significantly, a large volume was sold at the new price. Expect the price to be a roller-coaster the next 4-6 months.

Speculation over the halving event will drive the price up, but speculation tends to sell once said event occurs. Expect a fair dip in price around the end of August. After the expected dip, the price will likely recover as the reduced mining reward releases fewer coins to sell on the market.

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