Transactions fees for Litecoin are set for a 10-fold reduction. This reduction in fees could act as a boost to help adoption grow under the ‘medium of exchange’ use case.
— Litecoin.Com (@LitecoinDotCom) October 19, 2018
Transaction fees are normally set by the market, but developers make things easier for users by setting a default minimum fee in the software. They currently set it at 0.001 LTC/kB, but the new release will automatically reduce default fees for everyone who upgrades to the new client.
Not the only cryptocurrency getting cheaper
Last week Monero transactions dropped by almost 96% after the ‘bulletproof’ network upgrade that reduced its block size more than 90%. The hard fork also enables the use of confidential transactions. So far the upgrade has been living up to its promise by reducing the transaction fees to two cents on the network.
Means of exchange for Layer 2
Today a Litecoin transaction averages close to 10 cents in price. That may not sound like much (to send value across the world on a decentralised, censorship resistant and immutable blockchain) but the reduction in fees could help enable the use of Litcoin on layer 2 networks (EG lightning or liquid).
Earlier this month Coin Rivet brought you the story of how Charlie Lee had been using a combination of Litecoin and the Lightning network to ‘instantly’ buy Amazon gift cards.
Making it easier to ‘peg in and out’ of interoperable layer 2 protocols could create many new use cases for Litecoin- like the use of cross chain atom swaps to power new forms of decentralised applications.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.