What is Litecoin
Litecoin is a cryptocurrency very similar to Bitcoin. This means it can be used to pay for goods and services (and to fund casino accounts) because it can be sent around the world very quickly for very low fees. Although Bitcoin is still the most popular cryptocurrency that casinos accept, many are now accepting other cryptocurrencies and Litecoin is one of these.
Who created Litecoin?
Litecoin was released on October 7th 2011, by Charlie Lee (who used to work for Google). The Litecoin network itself went live about a week later (on October 13th 2011).
Differences between Litecoin and Bitcoin
Litecoin actually started by borrowing most of Bitcoin’s technology (it was forked from the Bitcoin project) but crucially has a number of differences, including:
- Decreased block generation time (2.5 minutes per block)
- Different hashing algorithm (how funds are encrypted)
- An increased cap on the amount of coins that can be generated
Litecoin took off very quickly and the month after it was released its value increased by 100%, in the same month Litecoin reached a $1 billion market cap.
Much like Bitcoin Litecoin is a cryptocurrency that operates peer-to-peer. Creation and transfer of coins is based on an open source cryptographic protocol. Litecoin is decentralized meaning that no institution or power controls its flow.
Caps and Scarcity
The Litecoin network is setup to produce 84 million Litecoins which is four times as many coins as the Bitcoin cap. The caps are important because they create scarcity, and the scarcity principle is one of the factors that create the value of cryptocurrencies. Litecoins are made by computers running mathematical calculations. People that make new Litecoins are termed ‘miners’ (just like with Bitcoin). Unlike Bitcoin however the relative profit for mining (relative to the coin itself) is higher right now and miners are awarded 50 new Litecoins per block they mine.
To mirror the scarcity principles of conventional precious materials, the amount of coins miners receive for mining decreases as more coins become publicly available. About every four years the amount of Litecoin miners receive per mined block is halved.
The Litecoin transfer fee is 0.02LTC which relative to the coin is higher than Bitcoins 0.0001BTC but when you consider the value of the coins this really isn’t all that bad, as one whole Litecoin is worth vastly less than one whole Bitcoin presently.
Why Litecoin is good for funding your casino and buying goods
Litecoin transaction times are faster than Bitcoin, this is partly due to the fact that the Litecoin Blockchain is more efficient. This is because blocks are generated more quickly than Bitcoin blocks.
This is a significant difference. An important consequence of the faster block generation is that Litecoin can handle higher volume transactions than Bitcoin. If Bitcoin wanted to rival Litecoin’s volume potential, it would require significant recording of the core Bitcoin software.
The speed also has an impact on the practicalities for merchants using the coins, the fastest confirmation time right now for Bitcoin is 10 minutes per confirmation. With Litecoin a merchant can receive two confirmations in just five minutes.