According to the Bits.media service, the Litecoin network halving should take place in a few hours already. Halving is a process where the reward paid to miners for mining a block is cut in half. This mechanism is designed to slow the flow of new coins into circulation, mitigate inflation, and increase coin shortages. Litecoin was launched in October 2011 as an alternative to Bitcoin, to increase transaction speeds and reduce costs. Demand for LTC is expected to increase over time.
Although the two cryptocurrencies have a lot in common, the main difference between Litecoin and its “big brother” Bitcoin lies in their mining algorithms. Bitcoin uses the SHA-256 algorithm, which requires enormous computing power. Litecoin uses a less resource-intensive algorithm called Scrypt, which allows users to mine LTC on personal computers.
In 2011, miners on the Litecoin network received 50 LTC for each new block mined. This fee was halved to 25 LTC in August 2015. After a subsequent reduction that occurred in August 2019, the award was reduced to 12.5 LTC. Upcoming third halving will cut miners’ payouts to 6.25 LTC per block. The rewards for miners will be halved every four years until the amount is zero. This is expected to happen around the year 2142.
What to expect from Litecoin halving?
Given that halving is a major event in the history of any blockchain, it contributes to increased volatility in cryptocurrencies both before and afterward. The first reduction in the reward to miners from 50 to 25 LTC occurred on August 25, 2015, on block number 840,000. At the time, LTC was trading at just under $3 per coin. The second halving occurred on August 5, 2019, when block number 1,680,000 was mined, by which time the LTC exchange rate had reached $93.20. The third halving of the award to 6.25 LTC should occur on block number 2,520,000. Right now, the LTC exchange rate is hovering around $90-$94.
According to
cryptocurrency exchange Binance forecasts that LTC will increase to $95.69 next year, and in 2025 it will exceed the round $100 mark. By the end of the decade, litecoin can be bought for $128, and by 2040 and 2050, the cryptocurrency will be worth $208 and $340, respectively.
In May, renowned cryptocurrency analyst Michel van de Poppe noted that LTC needs to break through strong resistance at $93 for a bull rally.