- Litecoin, Bitcoin, and other top 10 cryptocurrencies in the finance market are about to go on their third halving on August 2, 2023.
- It means the deduction will happen from the reward, so for the next four years, LTC will share 6.25 per block.
LTC, or Litecoin, is a decentralized cryptocurrency on PoW (proof-of-work). It was discovered by one of the most well-known people in the finance industry, Charlie Lee, a former Google engineer and Bitcoiner. It was first launched in October 2011. The algorithm of Litecoin is different from that of Bitcoin; this SHA-256 algorithm is changed by Scrypt. In 2014, it merged mining with a currency named Dogecoin (DOGE). It means LTC and DOGE are mined on the same computational equipment. In 2022, it had another update necessary for the currency that made a few of the transactions processed privately.
What Is Halving?
Yes, the pronunciation of the word ‘halving might sound similar, but the meaning is solely different. It is like a protection shield for PoW cryptocurrency. The process allows crypto to deduct 50% of one’s usual reward that they receive while mining. Hence, every four years, all the PoW currencies will receive a deduction of half the average premium. The reason behind it is the reward that miners receive for their contribution to the transaction. Due to the continuous reward of PoW, it was conscious of being a little extra vulnerable; therefore, this process was introduced to protect the PoW cryptocurrency from being vulnerable.
LTC halving impact on the cryptocurrency market
- Basic
It is done to reduce the LTC emissions per block. Every four years, the deduction takes place. Litecoin is not associated with the halving cycle. Besides this, the LTC has brought many economic changes to Litecoin.
- Date
In the POW cryptocurrency, the Litecoin halving process is associated with several blocks used for mining and not with many dates. The halving process timing is a bit different in Bitcoin and Litecoin. In Bitcoin, the halving happens after every 210,000 blocks and in Litecoin, the halving process happens after every 840,000 blocks.
- Prime Impact
It is unlikely that Litecoin is associated with price moments. Although the last two halves in August 2015 and 2019 turned out to be a considerable rally in Bitcoin, the first time it happened, the LTC price peaked at $3.98 to $314 and the second time it happened, it peaked at $95 to $354, which is the highest of all time.
- Ecosystem effect
With the rapid increase of currencies like Bitcoin and Litecoin, the community that pursues them also increases. The first time it took place, it started a support side chain and researched opportunities for fast payment methods and other stability solutions. The second time, it studied MimbleWimble for a transaction implanted on BEAM earlier.
