Charles Lee was a Google software developer who worked on the company’s cutting-edge operating system, ChromeOS. A hobbyist who rebuilt the world’s most popular digital currency.
It has found a home in the world, proving the demand for a new breed of money. After two years of testing, Lee’s innovation, Litecoin, has found a place in the world, demonstrating the appetite is high.
You would have done better if you had invested in Litecoin instead of Bitcoin on January 1. Bitcoin’s value has climbed from $13 to nearly $115 since then. In January, Litecoin was $0.07. It’s now worth $2.40. In January, it took 200 Litecoins to buy a Bitcoin, but now it only needs 50.
Bitcoin — and maybe Litecoin as well — may face government regulation. Digital currency, on the other hand, will keep innovating and flourishing. It’s what the majority of the globe wants.
People choose Litecoin because it is a more respectable alternative to the growing number of Bitcoin copycats that Lee perceived as either technologically inadequate or plain pump-and-dump operations. He left Google last month to seek his fortune in the wild west of alternative digital currencies.
He refined the underlying concepts underpinning Bitcoin, a cryptocurrency invented by a mysterious figure known only as Satoshi Nakamoto. Litecoin intends to protect Bitcoin from becoming too scarce and pricey. It speeds up transaction processing and reduces the number of high-volume, low-value transactions that have plagued the Bitcoin network.
It also makes it easier for ordinary people to “mine” coins, or give the online currency system the processing power it requires in return for digital cash. The end outcome wasn’t quite a Bitcoin-killer. It was, however, something that gave digital money another seal of legitimacy.
The Silk Road
Charles Lee, the son of an entrepreneur from the Ivory Coast, has an interest in economics. He defines himself as a gold investor who is wary of the Fed. He, like his father, earned a bachelor’s degree in computer science and electrical engineering from MIT. And in 2011, after more than a decade in Silicon Valley, he was seeking a fresh challenge. Bitcoin, an open-source software project that seemed to perfectly combine his love for money, encryption, and technology, was the answer. He first learned about it while reading an article on Silk Road, an online drug store, and began experimenting with the peer-to-peer software that underpins the digital currency. The inevitable next step was for him to develop his own
Fairbrix was his first currency, however, it was a flop due to technical difficulties. He tried again with Litecoin.
His Bitcoin fork was worthless on the day it releases, and it wasn’t the only Bitcoin option. However, unlike some other Bitcoin clones, Lee adopted a different approach. After mining only 150 Litecoins, he made the currency publicly available. This meant that anyone from anywhere in the world could participate in the currency’s early stages.
Miners, who involves in an intensifying technical race in the Bitcoin world in October 2011, received a bonus as well. Bitcoin miners earned coins by participating in a cryptographic lottery, with the winners receiving the most Bitcoins. People began to develop intricate Bitcoin mining rigs as the value of Bitcoin increased, allowing them to perform more computations and earn more Bitcoins.
Litecoin leveled the playing field by utilizing Scrypt technology to reduce the advantage that miners might get by moving to GPU rigs or custom-designed mining equipment.
Reflection
Lee was able to thrive where others had failed due to a few minor adjustments to the Bitcoin way of life. In many ways, two years later, Litecoin has begun to imitate the Bitcoin environment.
The underground drug-shopping mall Silk Road boosted Bitcoin’s popularity, and now Litecoin is accepted on Atlantis, a competitor to Silk Road. Casascius, a firm based in Utah, mints its own real Bitcoins, and Litecoin does as well, with the exception that the Litecoin version comes from Hawaii.
You’ll have a significantly tough time locating a Litecoin-accepting bar in London or a cab in San Francisco, but Jay’s Jerky and Goodies and BitElectronics, an online electronics company accepts Litecoin.
Litecoin, on the other hand, is primarily a vehicle for investors looking to get in on the ground floor of what may be the next big thing in digital currencies. However, there are a few hints that it is consolidating its position. Mt. Gox, Bitcoin’s most popular exchange, said earlier this year that it will begin trading Litecoin.
Consider the following to gain a feel of how things have changed. Noah Luis, the man who mints the Litecoin coins in Hawaii, persuaded someone on the internet to purchase him a pizza for 3,500 Litecoins, which were worth $30 at the time. That medium-sized meat-pizza lover was worth $8,400 at today’s market value. Luis says he has no regrets.
Warren Togami joined the project in May, which gave it a boost. He’d started the Fedora Linux project approximately a decade before, as a former Red Hat software developer.
Togami is now Litecoin’s chief developer, and he’s forming a nonprofit organization, similar to the Bitcoin Foundation, to oversee Litecoin software development and promotion.
Coinbase, a Bay Area business, recruited Lee away from Google.
Lee claims he isn’t working on Litecoin. He’s built some programming that allows Coinbase customers to send and receive Bitcoins through text messages. He wouldn’t rule out the idea of Litecoin being adopted by Coinbase.
Bitcoin’s journey has been a rocky one. The currency has descended into oblivion and then risen from the ashes. It regards with mistrust by bankers, regulators, and law enforcement organizations. If Litecoin continues to follow in Bitcoin’s footsteps, it will almost certainly face many more bumps along the road.
But, adds Jerry Brito, a senior research fellow at George Mason University’s Mercatus Center, even if it doesn’t survive, it serves an essential role. Bitcoin, he argues, is “just like any other open-source project where individuals will split it.” “That’s fantastic because it’ll lead to some fascinating new directions.”
