Litecoin Mining Guide for Beginners. Simple Steps to Follow!
Much like its older brother, Litecoin is a peer-to-peer online network people can use to send and receive payments. As Litecoin is decentralized and peer-to-peer, it is not controlled by a single entity or a government. This payment system doesn’t handle physical currencies such as the Rand or the Dollar. Instead, it uses its own unit called a Litecoin (symbol: Ł or LTC). As a result, this is why you will often see Litecoin classed as a digital or virtual currency. People can buy and sell Litecoin on a variety of cryptocurrency exchanges online. In this post, we will be talking about Litecoin Mining, an alternative way to accrue Litecoin tokens.
Rather than having a single central authority in charge of securing and controlling the money supply (as most governments to with their national currencies), Litecoin distributes this work over a network of miners. These miners apply large amounts of processing power and energy in order to solve computational maths problems on the blockchain in order to verify new transactions and assemble them into ‘blocks’ before adding them onto the chain. Collectively, all of these blocks constitute an authoritative record of all transactions ever made on the network. This is known as a blockchain.
Litecoin makes sure there can only be one blockchain by making blocks extremely hard to produce. Meaning instead of being able to create new blocks at will, miners will need to produce a cryptographic hash of the block, meeting certain criteria. The only way to find one is by computing as many blocks as you can and hope you get lucky and find the correct block before anybody else does. This is the aspect that makes solo mining so competitive. The miner that successfully adds a correct block to the chain is rewarded with 25 freshly minted Litecoins.
While this may seem like a get rich quick scheme if you’re hearing about it for the first time, it’s not. Every few days, the difficulty for mining blocks is adjusted based upon how frequently new blocks are appearing. The result of this is that more competition between miners will mean it will take more work to find a block. This network difficulty remains constant for all miners, and can be quantified by a number; The current Litecoin network difficulty is 8,000,573.76323430.
For the love of god…..why is the difficulty not down while mining Litecoin right now? pic.twitter.com/e6IhGqsMUr
— Skymans $LTC (@SkymansL) November 19, 2018
Is Litecoin Mining Worth it?
Under certain conditions, Litecoin mining can definitely be lucrative. In the early days of cryptocurrency, people could easily turn a profit by mining with their CPUs and GPUs. But now due to the introduction of specialized mining hardware (commonly known as ASIC miners), CPU and GPU mining is slowly becoming obsolete. Comparing the profitability analysis’ of a CPU, a GPU, and an ASIC miner will show you that the costs of CPU and GPU mining far outweigh the rewards. Even with access to free electricity; the profits are so small in comparison to ASIC miners that it’s hardly worth the effort.
2018 is the year it becomes dead simple for anyone to buy Bitcoin. We already have so many different apps that support it. Which big ones did I miss? Some of these even support Litecoin. Mainstream adoption here we come – Charlie Lee
Before you buy
Despite this, ASIC hardware is the furthest thing from being a crypto token generating machine. Potential ASIC buyers should take into several different elements in order to see if they are even able to turn a profit. Some of these factors are:
- Energy Consumption: If you’re paying more in electricity bills than you’re earning by mining Litecoin, you’re not making a profit. Having access to cheap or even free electricity is key when mining as ASIC miners use large amounts of electricity to function.
- Network Difficulty: With more miners joining the Litecoin network, some with extremely powerful mining farms; the overall mining difficulty rises every few days in order to compensate. For this reason, you should always take network difficulty when calculating your Litecoin mining profits.
- Resale Value: ASIC miners have only one function, mining cryptocurrency. Because of this, selling your hardware after you’re done with mining could be difficult. If you’ve stopped because cryptocurrency mining is dying, then chances are everyone else has as well.
- Entry Price: If you want to mine in order to create a worthy income, you’re either going to need several ASIC miners or hundreds of GPUs. This will cost you thousands and is a risky thing to do considering the current volatility in crypto prices right now.
If you’re looking for a wealth creation mechanism, mining is your best bet. But it’s never as easy as it sounds. Mining any cryptocurrency requires planning, and often, a large amount of money to start. ASIC mining hardware costs a lot of money, and it eats up a LOT of electricity. Having multiple means your electricity bill will change drastically. Hopefully, if you’ve set your rig up correctly, you should be making enough to still make a profit. Otherwise, trading may be your best option. Our cryptocurrency exchange allows users to trade Bitcoin (BTC), Cardano (ADA), and many more altcoins with low fees. Also, our Black Friday event is coming up soon and we are offering free coupons for 0% trading fees for a week!