Litecoin is the Hero We Need
The cryptocurrency that actually works as a currency
Every day there is a new cryptocurrency that’s “going to be the next big thing”. Investors rush to buy it and the price shoots up, spurring more interest, which leads to more investment, and the cycle continues until there’s no one left to buy in. At that point maybe bubble pops, or maybe it coasts, but it doesn’t really matter – there will be a new next-big-thing tomorrow.
When people rush to the cryptocurrency exchanges to buy whatever the crypto du jour is, they first have to get the funds to pay for it. Most altcoins aren’t bought with fiat currency, because most exchanges won’t let you deposit dollars or euros or yen. You usually have to buy altcoins with bitcoin, and, increasingly, that’s a problem.
Bitcoin, as a currency, is broken, because it’s a horrible medium of exchange. Here’s a chart from BitInfoCharts showing the average transaction fees for Bitcoin, Ethereum, and Litecoin since the start of this month.
The average transaction fee for Bitcoin is hovering around $25. Unless you’re ready to send a few million dollars worth of bitcoin, the fees make using it all but impossible, or at least really painful. Ethereum does much better at around $0.95, but that’s still a hell of a tax if you want to actually USE it to buy something.
But there, at the bottom of the chart, is Litecoin, with transaction fees currently around $0.35. Not great, but if you’re trying to move currency to an exchange to buy another crypto, Litecoin is the way to go. Once you get litecoin to an exchange you can trade it for bitcoin to buy whatever you’re looking for, or, increasingly, just use litecoin to buy the altcoin directly.
The Litecoin Advantage
When Charles Lee forked Bitcoin to create Litecoin way back in 2011, he wanted a coin that was both faster and fairer. He got the faster part by decreasing the blocktime from 10 minutes to 2.5. He got a fairer coin by using the Scrypt algorithm, instead of the SHA-256 used by Bitcoin. Scrypt is more memory intensive than SHA-256, meaning it took longer for ASIC chips that could mine Litecoin to appear.
Litecoin can also scale better than Bitcoin or Ethereum, with 56 transactions per second vs 7 and 15, respectively. There are currently over 150,000 unconfirmed transactions waiting to be mined on the Bitcoin network, worth over $13 million – because the Bitcoin network just can’t keep up.
Meanwhile, Ethereum is congested with cats. Ethereum is working on scaling solutions, like sharding and the Raiden network, but there’s no firm release date planned.
All Hail the Benevolent Dictator
Unlike Satoshi Nakamoto, Charles Lee didn’t disappear after founding Litecoin. Since its creation he’s taken the role of benevolent dictator, directing the development and improvement of the coin.
“Our community is smaller, so it’s easier for us to convince a large proportion of people to upgrade.” – Charles Lee
While Bitcoin has undergone a number of hard-forks as various groups argue about what “the true Bitcoin” is supposed to be, Lee has quietly pushed his coin forward.
Litecoin has the attributes of a real currency
Litecoin has low fees, fast transaction times, great scalability, and its actually being used as a store of value and a medium of exchange. I don’t know what the cryptocurrency of the future is, but I know what the cryptocurrency of today is.