Litecoin is Flatlined

  • Post comments:0 Comments
  • Reading time:7 mins read

Litecoin (LTC) is a cryptocurrency similar to Bitcoin. It is based on the same software, but rather than using Blockchain (the distributed ledger technology behind Bitcoin), it uses its own modified version, called “segwit,” which integrates a second kind of transaction that can be used to make Litecoin transactions faster and cheaper, called “Lightning Network.”

Litecoin has had a good year. Its market capitalization has doubled since last year, passing $2 billion–but not because it is worth twice as much. It has only risen in price because the value of Bitcoin has risen so rapidly. So when we look at the price chart for Litecoin and we see a big gap between it and the Bitcoin price chart, we should take that to mean that Litecoin’s price is flatlined.

Cryptocurrencies are volatile. This is one of their selling points, but it can make it hard to figure out which ones you should buy. Bitcoin has been flatlining since February. So while it’s up over 700% this year, Litecoin has gained a similar amount, and Ripple has more than doubled.

Litecoin was created in 2011; its original purpose was to be used as a currency within the online gaming community that had sprung up around Bitcoin. Litecoin can be mined with ordinary computers, but if you want to get into the mining game, you need special hardware called an ASIC (application-specific integrated circuit). You can mine Litecoin using a normal PC or a Mac, but if you want to use an ASIC miner, you need to buy it from someone who already owns one.

The difficulty of getting an ASIC for your particular machine means that for two years there were only about 30 machines on the network. The network’s hash rate—the number of calculations per second it could do—was designed to keep miners from being able to double-spend their coins by creating new coins out of thin air; the bitcoin protocol says coins must have a certain amount of “hashing power” to be valid, and imposing that limit made it harder

Bitcoin is a very interesting example of the dangers of ignoring the supply and demand. Bitcoin has a fixed supply, so it would have an intrinsic value. But bitcoin has no inherent value. It only has value as a medium of exchange. If there was no one to trade bitcoins for goods and services, they would become worthless.

If you ignore the supply and demand curve, you get what economists call a “Ponzi scheme.” That’s what Litecoin has become. The price is going up because people are buying into the idea that it will go up in the future, not because anyone is actually using it to buy things.

The difference between bitcoin and Litecoin is that in bitcoin the supply is fixed, but in Litecoin it can be increased by people who get more coins than they want to sell, so they can sell them to someone who wants to pay more than they do.

Bitcoin is the most famous cryptocurrency, and has been the most successful. But several other cryptocurrencies have been launched since then, notably Ethereum, which has a market capitalization of about $1 billion.

Bitcoin and its rivals are collectively called altcoins. Altcoins are cryptocurrencies that aren’t based on Bitcoin. Most of them are much less successful than Bitcoin; indeed, as far as anyone can tell, none of them is a bubble. But in general there seems to be a positive correlation between how much hype they get and how low their prices go; the more hype they get before they die, the lower they go when they die.

It is a good idea to keep an eye on cryptocurrency prices. If you’re looking at the price of bitcoins or ethereum, however, you are probably looking in the wrong place.

Let’s start with bitcoin. Bitcoin was created in 2009 to serve as the currency of the net-savvy dark web (the part of the internet where you can buy drugs and stolen credit cards). In 2011 its founder, a mysterious pseudonymous entity named Satoshi Nakamoto, added a rule that limited each bitcoin to 21 million coins. The program he wrote to enforce this rule is called “proof of work”; it makes sure that no more than a certain fraction of the bitcoins can be created by solving complicated mathematical puzzles. The proof-of-work puzzles are easy for computers to solve; computer programs have been written to do it for years. But those programs are not allowed to use any modern graphics chips or fast memory or other tricks that make it easier for them to find a solution.

This is why bitcoin mining is so expensive. It costs thousands of dollars in electricity and computer time just to mine one bitcoin. It also limits how fast new bitcoins can be created; every four years, the number gets cut in half, and at some point there won’t be enough new coins being

It is easy to make money in Bitcoin, but getting rich is harder. Bitcoin is a kind of cryptocurrency, which is a class of numbers that can be used as currencies. It’s very easy to create new ones: to create one you need to solve a mathematical problem. It’s not hard to do that, and you’ll get rewarded if the result is accepted by the network as a currency.

But the network is not run by humans. It’s maintained by computers running something called “the blockchain.” The blockchain keeps track of which currencies are valid, and records who has how much of them. It also records who has been making what changes to the database, because anyone can change it without asking permission (anyone except miners).

You can’t do this without computing power; that’s what makes it secure. When you spend your coins, they have to go somewhere. That somewhere could be your computer or someone else’s computer; sometimes it will be the same computer you’re using now; and sometimes it will involve a lot of people all over the world working together.

It sounds complicated, but in practice it isn’t hard at all; there are already whole businesses built around mining Bitcoin and making changes to the blockchain database for other people (called “mining pools

When it came out, Bitcoin was the first cryptocurrency. It used a blockchain, a kind of public log that records every transaction made in the network; this is like a financial version of a public ledger of everyone’s moves in a multiplayer online game. The way Bitcoin has been improved since then—scalability, faster transactions, etc.—is like how people fix up old computer games that are no longer fun: they add new features and upgrade the graphics and change the interface.

The same is true of other cryptocurrencies. They all have their own innovations, but they all have the same basic structure: they are based on another kind of cryptocurrency, which is based on Bitcoin. The whole thing is a huge decentralized network of computers whose job is to maintain the system and keep track of all the transactions.

But what makes cryptocurrencies different from other currencies is that they use cryptography to protect their integrity: if you wanted to spend money that wasn’t yours, you would have to break into many different computers at once, or else hack into one computer at a time until you got in.

Cryptocurrencies have had huge success because they have solved two problems beyond what most people thought could be solved for money: security and scalability.

Leave a Reply