What is Litecoin (LTC)?

Charlie Lee and the Origins

Charlie Lee, a computer scientist who worked at Google and later Coinbase, created Litecoin in October 2011. Inspired by Bitcoin but wanting to improve on certain aspects, Lee modified Bitcoin's code to use the Scrypt algorithm (which was initially more resistant to ASIC mining), reduced block times to 2.5 minutes, and increased the total supply to 84 million coins.

Litecoin launched via a fair mining process with no pre-mine.

Growth and Adoption

Litecoin quickly gained popularity as one of the first "altcoins" and was among the earliest cryptocurrencies listed on major exchanges. Its similarity to Bitcoin made it easy for developers and users to adopt, while its faster block times made it more practical for payments.

By 2013, LTC had established itself as one of the top cryptocurrencies by market capitalization — a position it has maintained for over a decade.

Key Milestones

• • October 2011: Litecoin launches with fair mining, no pre-mine.
• • 2013: LTC reaches top 5 cryptocurrencies by market cap.
• • May 2017: Litecoin activates SegWit — the first major coin to do so, ahead of Bitcoin.
• • August 2015: First Litecoin halving reduces block reward from 50 to 25 LTC.
• • August 2019: Second halving reduces block reward to 12.5 LTC.
• • May 2022: MimbleWimble Extension Blocks (MWEB) activates, adding optional privacy.
• • August 2023: Third halving reduces block reward to 6.25 LTC.

The Litecoin Foundation

The Litecoin Foundation is a non-profit organization dedicated to advancing Litecoin adoption and development. Founded in 2016, it funds development, sponsors events, and promotes Litecoin's use in commerce. Charlie Lee serves as Managing Director. The foundation operates independently from any single company, helping ensure Litecoin's decentralized governance.

Scrypt Algorithm

Litecoin uses the Scrypt hashing algorithm instead of Bitcoin's SHA-256. Scrypt was originally chosen because it is memory-intensive, which was intended to make it harder to develop specialized mining hardware (ASICs). While Scrypt ASICs have since been developed, Litecoin's mining ecosystem remains distinct from Bitcoin's, with its own hardware manufacturers and mining pools.

Faster Block Times

Litecoin produces a new block every 2.5 minutes — four times faster than Bitcoin's 10-minute block time. This means LTC transactions receive their first confirmation faster, making it more practical for point-of-sale payments. The trade-off is slightly less security per confirmation, though waiting for the equivalent security (4 LTC confirmations = 1 BTC confirmation) takes the same time.

MimbleWimble Extension Blocks (MWEB)

Activated in May 2022, MWEB adds optional privacy to Litecoin. Users can send LTC through the MWEB extension block where transaction amounts are hidden using Confidential Transactions. Coins can move freely between the main chain and the MWEB sidechain.

This improves fungibility — meaning all LTC are equally interchangeable — while keeping the transparent base layer intact for users who prefer or require transparency.

Supply and Tokenomics

Litecoin has a maximum supply of 84 million coins — exactly four times Bitcoin's 21 million. Block rewards halve every 840,000 blocks (approximately every four years), mirroring Bitcoin's deflationary schedule on a proportional basis.

What is Litecoin mining?

Litecoin uses Proof-of-Work consensus with the Scrypt algorithm. Miners compete to solve cryptographic puzzles, validating transactions and earning block rewards in LTC. The 2.5-minute block time means blocks are found four times more frequently than Bitcoin, providing more consistent mining income.

Mining hardware

Scrypt was originally designed to be ASIC-resistant, but specialized Scrypt ASICs were developed starting in 2014. Modern Litecoin ASICs like the Bitmain Antminer L9 dominate mining. GPU mining of LTC is no longer profitable. Many Scrypt miners also merge-mine Dogecoin, earning DOGE alongside LTC from the same hardware and electricity costs.

Mining pools

Most Litecoin miners join mining pools to receive steady payouts. Popular LTC pools include LitecoinPool, F2Pool, and ViaBTC. Pool fees typically range from 1-3%, and payouts are distributed based on contributed hashrate. Many pools support merged mining with Dogecoin.

Profitability considerations

Mining profitability depends on electricity costs, hardware efficiency, LTC price, and network difficulty. With ASICs dominating, home GPU mining is not cost-effective. The ability to merge-mine Dogecoin improves economics for Scrypt miners. Before investing in mining hardware, use profitability calculators and factor in the upcoming halving schedule.

1Compare providers

LTC is available on every major exchange including Coinbase, Kraken, Binance, Gemini, and many more. Compare fees, spreads, and supported payment methods before choosing where to buy.

2Create an account and verify identity

Register on your chosen exchange and complete identity verification (KYC). This typically requires government ID and may take a few hours to a few days. Enable two-factor authentication (2FA) for security.

3Choose a payment method

Fund your account via bank transfer, credit/debit card, or by depositing other cryptocurrencies. Bank transfers typically have lower fees but take longer. Cards offer instant purchases at higher fees.

4Buy LTC

Place a market order for instant purchase at current prices, or use a limit order to specify your target price. Start with a small test purchase to familiarize yourself with the process.

Wallet types

Litecoin has excellent wallet support across all platforms:

• • Mobile wallets: Litewallet (official), Trust Wallet, Exodus, Cake Wallet
• • Desktop wallets: Litecoin Core (full node), Electrum-LTC, Exodus
• • Hardware wallets: Ledger, Trezor (both support LTC natively)

For MWEB privacy features, ensure your wallet supports the extension blocks. Litecoin Core and Litewallet both support MWEB.

Hardware wallets

Ledger and Trezor both provide full LTC support. As one of the oldest altcoins, Litecoin has been supported by hardware wallets since their earliest days. Hardware wallets are the safest way to store larger amounts of LTC for the long term.

Seed phrase and security

When setting up a self-custody wallet, you'll receive a 12 or 24-word seed phrase. Write it down on paper and store it securely offline. Never share your seed phrase or enter it on websites. Anyone with your seed phrase can access your funds. Litecoin addresses begin with "L" or "M" (legacy) or "ltc1" (native SegWit).

Payments and Transactions

Litecoin's fast confirmation times and low fees make it one of the most practical cryptocurrencies for payments. Many merchants and payment processors accept LTC, and it is commonly used for transferring value between exchanges due to its speed and low cost. A typical LTC transaction costs less than a cent and confirms in about 2.5 minutes.

Private Transactions (MWEB)

With MWEB, Litecoin users can opt into confidential transactions where the amounts are hidden. This improves financial privacy for sensitive transfers like salaries, business payments, or donations — without requiring a separate privacy coin.

Store of Value

With its fixed supply of 84 million coins, halving schedule, and over a decade of proven security, Litecoin can serve as a long-term store of value. Its "silver to Bitcoin's gold" positioning means many holders keep LTC alongside BTC in a diversified crypto portfolio.

Exchange-to-Exchange Transfers

Due to its fast confirmation times, low fees, and universal exchange support, LTC is commonly used to move value between exchanges. Instead of paying high BTC or ETH fees, traders often convert to LTC, transfer, and convert back — a testament to Litecoin's utility as a transfer medium.

Risks of Holding Litecoin

LTC carries risks common to all cryptocurrencies: price volatility, security risks from self-custody, and evolving regulations. Additionally, Litecoin faces competition from newer, faster blockchains, and its price has declined relative to BTC over time. MWEB privacy features could attract regulatory attention in some jurisdictions, as seen with exchanges delisting other privacy coins.

Charlie Lee

Creator of Litecoin and Managing Director of the Litecoin Foundation. A former Google and Coinbase engineer, Charlie Lee launched Litecoin in 2011 and has remained its most prominent figure. In late 2017, he famously sold all his LTC holdings to avoid perceived conflicts of interest, a move that was both praised for its transparency and criticized by some holders.

David Burkett

Lead developer of the MWEB (MimbleWimble Extension Blocks) upgrade. Burkett spent years designing and implementing the privacy extension that activated on Litecoin in May 2022, bringing confidential transactions to LTC.

Warren Togami

Early Litecoin developer and founder of Blockstream Satellite. Togami contributed to Litecoin's early development and helped maintain the network's infrastructure during its formative years.

Alan Austin

Director of the Litecoin Foundation, working on partnerships, merchant adoption, and broader ecosystem growth. Austin has been instrumental in establishing Litecoin as a practical payment method.

Regulatory Status

Litecoin benefits from regulatory clarity similar to Bitcoin. As a Proof-of-Work cryptocurrency with no pre-mine, no ICO, and over a decade of track record, LTC has generally been classified as a commodity or property in most jurisdictions rather than a security. It is universally available on regulated exchanges worldwide.

MWEB and Regulatory Considerations

The MWEB privacy feature has attracted some regulatory attention. A few exchanges, particularly in South Korea, temporarily delisted or restricted LTC trading following the MWEB activation due to concerns about enhanced transaction privacy. However, MWEB is optional, and the transparent base layer remains fully auditable, which has limited broader regulatory impact.

Country Differences

Regulations vary by jurisdiction. Here is a snapshot:

United States: LTC is legal, classified as a commodity by the CFTC. Available on all major US exchanges. Capital gains tax applies.

Canada: Legal and widely available. Subject to capital gains tax. Available with Interac e-Transfer on most Canadian exchanges.

European Union: Legal across the EU. Subject to MiCA regulations.

Australia: Legal and available on Australian exchanges. Subject to CGT rules enforced by the ATO.

Litecoin's long history and Bitcoin-like characteristics give it strong regulatory standing in most markets.