Litecoin (LTC) is a peer-to-peer cryptocurrency that Charlie Lee, then an engineer at Google, released in October 2011. Lee copied the Bitcoin codebase and changed a handful of settings to make a faster, lighter payment coin. He often described it as silver to Bitcoin's gold: a network for smaller, everyday payments, not a replacement for Bitcoin. The project's own site, litecoin.org, still presents it as open-source money for fast, low-cost payments.
Litecoin is one of the oldest cryptocurrencies still running. It has operated since 2011 on the same Proof of Work design, with no pre-sale and no company issuing the coin.
How Litecoin Differs from Bitcoin
Litecoin keeps the structure set out in the Bitcoin whitepaper: a public ledger, blocks linked by hashes, and miners who compete to add the next block. The differences are in the parameters.
- Block time: a new block about every 2.5 minutes, compared with about 10 minutes on Bitcoin.
- Supply cap: 84 million LTC, four times Bitcoin's 21 million.
- Mining algorithm: Scrypt instead of SHA-256.
- Halving interval: the block reward halves every 840,000 blocks, which works out to roughly every four years.
Faster blocks mean a payment gets its first confirmation sooner. They do not make each confirmation as strong as a Bitcoin confirmation, because less mining work goes into each Litecoin block. Exchanges and merchants usually ask for several confirmations before treating an LTC deposit as final.
Scrypt and Mining
Scrypt is a hashing function that needs more memory than SHA-256. In 2011 the idea was that this would keep mining practical on ordinary computers and graphics cards for longer. That did not last. Specialized Scrypt mining machines (ASICs) arrived within a few years and now do nearly all Litecoin mining.
Miners collect pending transactions into a block and race to find a valid hash. The winner earns the block reward plus the transaction fees. The network retargets mining difficulty every 2,016 blocks, about every three and a half days, to hold the average block time near 2.5 minutes.
Dogecoin also uses Scrypt. Since 2014, miners have been able to mine Litecoin and Dogecoin at the same time, a setup called merged mining.
Supply and Halvings
Litecoin started with a reward of 50 LTC per block. The reward has been cut in half three times so far.
- August 2015: reward fell to 25 LTC.
- August 2019: reward fell to 12.5 LTC.
- August 2023: reward fell to 6.25 LTC.
The next halving is expected in 2027 and will lower the reward to 3.125 LTC. Issuance keeps shrinking this way until the 84 million cap is reached, which is projected for around the year 2142.
Halvings reduce the amount of new LTC that miners receive. They do not guarantee any particular price outcome. Past halvings were followed by both rallies and declines.
Upgrades: SegWit, Lightning and MWEB
Because its code is so close to Bitcoin's, Litecoin has sometimes adopted Bitcoin upgrades first.
Segregated Witness (SegWit) activated on Litecoin in May 2017, a few months before it activated on Bitcoin. SegWit changes how signature data is stored, which fixes a transaction malleability problem and makes room for more transactions per block. It also made the Lightning Network possible. Lightning is a system of off-chain payment channels for instant, very small payments, and it works on Litecoin as well as Bitcoin, although Bitcoin's Lightning network is much larger.
In May 2022, Litecoin activated MimbleWimble Extension Blocks (MWEB). MWEB is an optional side area of the chain where amounts are hidden from public view. Users choose whether to move coins into it. The feature drew attention from regulators. Several South Korean exchanges removed LTC in 2022 because of the privacy option, and that risk has not gone away.
What Litecoin Is Used For
Litecoin has always been a payments coin. It has no general smart contract platform and no large DeFi sector. Its main uses are simple.
- Sending value between people and across borders with low fees.
- Moving funds between exchanges, since LTC is listed on most large trading venues and confirms faster than Bitcoin.
- Paying merchants through crypto payment processors, many of which support LTC alongside Bitcoin.
Acceptance by any specific merchant changes over time, so check with the payment processor or store before relying on it.
Criticism and Risks
- Identity: many newer networks offer fast, cheap transfers, and stablecoins now handle a large share of crypto payments. Critics ask what Litecoin offers that others do not.
- Founder sale: Charlie Lee announced in December 2017 that he had sold or donated his LTC, saying he wanted to avoid a conflict of interest. Some holders read it as a lack of commitment. He has remained involved through the Litecoin Foundation.
- Privacy regulation: MWEB may lead more exchanges in strict jurisdictions to limit or drop LTC.
- Volatility: LTC has lost more than 80% of its value from peak to trough in past bear markets.
A common mistake is to treat LTC as cheap because its unit price is far below Bitcoin's. With four times the supply cap, unit price alone says nothing about value. Compare market capitalization instead.
Nothing in this article is financial advice.
Key Litecoin Facts
- Launched: October 2011
- Creator: Charlie Lee
- Consensus: Proof of Work (Scrypt)
- Block time: about 2.5 minutes
- Maximum supply: 84 million LTC
- Block reward: 6.25 LTC since August 2023
- SegWit: May 2017
- MWEB: May 2022
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The Litecoin price page shows the live LTC price, market cap, circulating supply and chart. To compare it with Bitcoin, open the Bitcoin page alongside it, or use the converter to see what an amount of LTC is worth in BTC or dollars.