DEFINITION of 'Litecoin'

Launched in the year 2011, Litecoin is an alternative cryptocurrency based on the model of Bitcoin. Charlie Lee, a MIT graduate and former Google engineer, is Litecoin's creator. Litecoin is based on an open source global payment network that is not controlled by any central authority. Litecoin differs from Bitcoins in aspects like faster block generation rate and use of scrypt as a proof of work scheme. 

BREAKING DOWN 'Litecoin'

Litecoins were launched with the aim of being the "silver" to Bitcoin's "gold," and have gained much popularity since the time of inception. Litecoin is a peer-to-peer internet currency. It is a fully decentralized open source, global payment network. Litecoin was developed with the aim to improve on Bitcoin's shortcomings, and has earned industry support along with high trade volume and liquidity over the years. The broader differences between the two cryptocurrencies are listed in the table below.

 

Bitcoin

Litecoin

Creation

2009

2011

Creator

Satoshi Nakamoto

Charles Lee

Coin Limit

21 Million

84 Million

Block Generation Time

10 Minutes

2.5 Minutes

Algorithm

SHA-256

Scrypt

Initial Reward

50 BTC

50 BTC

Current Block Reward (as of June 2014)

25 BTC

50 BTC

Rewards

Halved every 210,000 blocks

Halved every 840,000 blocks

Difficulty Retarget

2016 Block

2016 Block

Litecoin is designed to produce more coins (Four times that of Bitcoin) and at a faster rate (1/4th of the time of Bitcoin). Overall, Litecoin is seen as second to Bitcoins in value, but Litecoins are more easily obtainable and transactional.

RELATED TERMS
  1. Bitcoin

    A digital or virtual currency that uses peer-to-peer technology ...
  2. Block (Bitcoin Block)

    Blocks are files where data pertaining to the Bitcoin network ...
  3. Cryptocurrency

    A digital or virtual currency that uses cryptography for security. ...
  4. Bitcoin Mining

    Bitcoin mining is the process by which transactions are verified ...
  5. Trade Hill Exchange

    A Bitcoin exchange launched in June of 2011. Trade Hill Exchange ...
  6. Double-Spending

    The risk that a digital currency can be spent twice. Double-spending ...
Related Articles
  1. Investing

    What Is Litecoin And How Does It Work?

    Litecoin is one of the major competitors to bitcoin. Litecoin differs from bitcoin and other cryptocurrencies in various ways and may become a dominant cryptocurrency.
  2. Small Business

    Bitcoin Vs. Litecoin: What's The Difference?

    Litecoin is often referred to as "the silver to Bitcoin's gold." But what is Litecoin, and how does it compare to its more famous counterpart?
  3. Financial Advisor

    Bitcoin Vs. Litecoin Vs. Dogecoin: Comparing Virtual Currencies

    Read about several of the world's most widely used cryptocurrencies, and learn more about how they function and perform in the marketplace.
  4. Investing

    The Bitcoin Halving: Why It Matters, What to Expect

    The halving is coming.
  5. Investing

    Bitcoin Price Soars, Approaches $550

    The price of Bitcoin is at its highest since August 2014. What's behind the uptick?
  6. Insights

    Bitcoin Extends Rally, Breaks Through $700

    Bitcoin​, the blockchain​-based digital currency has extended its recent rally and is now exceeding $700, giving it a "market cap" of just under $11 billion.
  7. Trading

    What's Fueling Bitcoin's Record-Breaking Price?

    Tracking the reasons behind bitcoin's price rally: "Halving" and China
  8. Small Business

    Basics For Buying And Investing In Bitcoin

    Bitcoin continues to experience growth in both users and merchants, generating a common question - how can you be part of the action?
  9. Small Business

    How Bitcoin Can Change The World

    Bitcoin has the potential to not only create savings for consumer, but also to transform global transactions.
  10. Small Business

    Ways To Earn Bitcoins

    There are many ways to earn and own Bitcoins other than just buying them on a Bitcoin exchange.
RELATED FAQS
  1. How do you buy Bitcoins?

    Many people have heard of this virtual cryptocurrency, but few know all the ways you can purchase Bitcoin. Read Answer >>
  2. What does a block chain record in a bitcoin exchange transaction?

    Read about the bitcoin blockchain, a public ledger shared among all bitcoin users that records the information of every single ... Read Answer >>
  3. What are the risks of investing in Bitcoin?

    Learn how Bitcoin is an unregulated, uninsured and unregistered private digital currency that can be used as a speculative ... Read Answer >>
  4. Why do Bitcoins have value?

    Performing with transactional anonymity, Bitcoin has value as a private digital currency, investment tool and social networking ... Read Answer >>
  5. How does a block chain prevent double-spending of Bitcoins?

    Find out how double-spending is prevented in the Bitcoin server and how transactions are posted and verified on the Bitcoin ... Read Answer >>
  6. What are the advantages of paying with Bitcoin?

    Learn how payments made with Bitcoins offer certain advantages over standard currency, including user anonymity, no taxation ... Read Answer >>
Hot Definitions
  1. IRS Publication 970

    A document published by the Internal Revenue Service (IRS) that provides information on tax benefits available to students ...
  2. Federal Direct Loan Program

    A program that provides low-interest loans to postsecondary students and their parents. The William D. Ford Federal Direct ...
  3. Cash Flow

    The net amount of cash and cash-equivalents moving into and out of a business. Positive cash flow indicates that a company's ...
  4. PLUS Loan

    A low-cost student loan offered to parents of students currently enrolled in post-secondary education. With a PLUS Loan, ...
  5. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  6. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
Trading Center