Litecoin (LTC) is currently the sixth largest cryptocurrency in the world, according to CoinMarketCap. Its price has been shooting up in huge increments lately, capturing the attention of many investors. So, if you want to learn how to mine Litecoin, this could be a good moment to do it.
Litecoin surged above $97 at the beginning of April. The price has seen a significant decrease after being close to reaching the $100 milestone. However, price predictions for the rest of 2019 are still looking bullish. Moreover, LTC is expected to grow significantly after introducing Confidential Transactions recently.
A brief recap on Litecoin
Litecoin has been in the market since 2011. It’s a peer-to-peer cryptocurrency created by Charlie Lee, an ex-Google employee. The cryptocurrency was built on the Bitcoin protocol but uses a different hashing algorithm.
If you want to know how to mine Litecoin, you should know that the network uses the PoW (Proof-of-Work) consensus algorithm and the Scrypt mining algorithm (Bitcoin uses the SHA-256 algorithm).
Mining Litecoin is a resource-intensive process, but you can still use your GPU to do it. In fact, this digital coin is far more accessible than Bitcoin for miners and investors because it doesn’t require expensive ASIC hardware for mining. That said, having some decent equipment is recommended for improved ROI.
Another difference between Litecoin and Bitcoin is regarding the market supply. Bitcoin has a maximum supply of 21 million coins, while Litecoin will reach 84 million.
The Litecoin reward halves every 840,000 blocks (four times more than Bitcoin) and the transaction fee is 0.02 LTC.
How to mine Litecoin
The process of mining Litecoin is pretty similar to Bitcoin mining, so you have the same three options to choose from:
- Solo mining at home
- Mining using a mining pool
- Mining Litecoin utilising a cloud mining service
Regardless of the method you choose, make sure you have a Litecoin wallet to store your coins before you start. This way, you won’t risk losing your investment.
How to mine Litecoin at home
Mining Litecoin at home means that you won’t share the reward with anyone. But the downside is that you won’t share the electricity bill either. And if you don’t win any block rewards for a while, you may end up with unsustainable high costs and zero benefits.
When looking into how to mine Litecoin at home, you’ll see that you can do it by using your CPU or graphics card. However, if mining isn’t just a hobby, you should consider buying specific hardware, specially designed for Scrypt-based cryptocurrency mining.
ASIC miners are more powerful than CPUs and GPUs, so they’ll increase your chances of getting those mining rewards. The equipment also needs a separate power supply cord and some fans to prevent overheating.
You’ll also need a mining software — a free one if you use graphics cards, a pre-installed one if you opt for an ASIC miner.
Now you’re ready to start mining, following the instructions in the software package.
The trick is monitoring your performance regularly, to make sure you’re not losing money by mining the wrong digital coins. Also, be sure to track the LTC price and all mining costs to make sure you’re making a profit.
How to mine Litecoin using a mining pool
If you’re not the lonely wolf kind, you may want to join forces with other miners. The advantage of this is higher computing power, but you’ll only get a small share from the LTC mined, as the block reward is the result of combined efforts.
The good news is that you’ll probably receive more frequent payouts than if you were working alone. The rule is simple. The larger the pool, the higher the chances of getting rewards — and the smaller the amount that goes to you.
The challenge when mining through a pool is finding the right platform. You still need hardware and software. But you also need time to research and compare features of the various mining pools out there.
As a general guide, consider rewards, fees, and minimum payouts, as well as the pool’s reputation in the crypto community before joining. Start following the instructions provided by the mining pool and transfer all rewards to your LTC wallet often.
How to mine Litecoin using a cloud mining service
Wondering how to mine Litecoin without initial investment in ASIC miners and software? Cloud mining services allow you to use powerful hardware and innovative software by leasing them.
However, as you don’t own the equipment, you don’t have complete control of the operations. Analyse the contracts and see how much you will have to pay for the service and what payout you can expect.
Try to understand what kind of hardware and software the provider owns and uses and how it will increase the return on your investment. Once you’ve signed up for the service, join a mining pool for extra chances of making a profit.
Mining can still be profitable if you have the right tools and monitor your performance regularly. For many, mining Litecoin is better than mining Bitcoin. However, as nothing is 100% secure in the cryptocurrency ecosystem, there’s no guarantee that choosing one over the other will yield more benefits in the long run.
The essential rule when mining is to transfer all rewards to your wallet as soon as possible. Storing your LTC or any other digital coin in a safe wallet is the only way to protect your assets and make money from mining cryptocurrencies.