The original article was created in December of 2019. Later, the data was updated in June of 2020.
Speaking about mining of Litecoins, it’s worth to start with considering such a concept as mining in general. Let’s start from the early beginning, we will analyze the main points of mining and consider this issue with a more detailed study of mining as the general meaning.
Table of contents
- What is mining?
- How does mining work?
- The most popular coins for mining.
- Is mining profitable?
- Some information about Litecoin in numbers.
- Litecoin Mining Prospects in 2019-2020. The future predictions. What is mining?
- The most trustworthy devices to mine Litecoin in 2020.
- Litecoin Mining – GPU or ASIC?
What is mining?
Referring to Wikipedia, we will define mining as,
Mining is a kind of activity for the creation of the new structures (usually, new blocks in the blockchain) for ensuring the functioning of cryptocurrency platforms. Namely, cryptocurrency mining is a kind of the process when cryptocurrency transfers between users are checked and placed into the blockchain public ledger. For the creation of the next structural unit, a reward is usually provided for at the expense of new (issued) units of cryptocurrency and (or) commission fees.
It is important to note the fact that different crypto coins have different approaches and use different calculation models while working. These models are always long enough to find an acceptable option and to verify Proof of work fast. Such calculations are made for cryptocurrency algorithms to protect the same units reuse. Money (the bonus for mining operations) encourages people to spend their computing power and support the networks operation. It is important to note that the mining process is responsible for introducing new coins into the existing turnover. And, moreover, it is one of the key elements that allow cryptocurrencies to work as a peer-to-peer decentralized network. What does decentralized mean? This indicates that there is no need for an external central authority to complete transactions.
How does mining work?
To understand how cryptocurrencies are being mined, you need to understand what a mining algorithm is. As you know, each digital currency is created via a specific encryption algorithm. This code is being decrypted with the mining equipment, providing processing of transactions on the network and bringing reward to the miner (owner of the mining machine).
Every miner must own a powerful computer and a special program for competing with their peers in solving complicated mathematical problems. Mass of the computer resources are needed for mining to be possible. In regular intervals, miners will try solving a block having the transaction data using cryptographic hash functions.
The most popular coins for mining:
Bitcoin is known to be the most popular and well-established example of cryptocurrency assets which can be mined.
It is worth noting that not all cryptocurrency coins are mineable, and even those which can be mined have different conditions for “new coins creation” while mining.
In general, cryptocurrency mining is not an easy activity, as one may think. Beginning in 2012, the demand for digital assets increased significantly. As a result, the power and predicament of this process have become challenging and high-priced. Although most miners focus their main activity on getting Bitcoin, users can also get other digital coins, such as Litecoin, Bitcoin Cash, Monero, and Ethereum.
Is mining profitable?
Of course yes, otherwise, who would do it for free?! For miners, the extraction of new cryptocurrencies can (and should) be a useful event, since they earn cryptocurrency for their work (as a commission or bonus). However, the process of checking information and / or filling blocks is very tedious and expensive, since it requires the involvement of complex, expensive devices.
For some part, we can even say that miners are some kind of auditors. They verify the authenticity of transactions that want to be part of the blockchain, prevent any double-spending transactions (which may occur in the process, in case of inaccuracy or error). In other words, they verify that the same cryptocurrency funds are not spent twice.
The production process itself is a kind of competition. Miners compete with each other to solve a mathematical problem related to data transactions. The first miner who solved the problem receives cryptocurrency as a reward.
Some information about Litecoin in numbers:
In 2011, after the fork of Bitcoin (BTC), a new Litecoin (LTC) cryptocurrency appeared. It is a cryptocurrency asset, created by Charlie Lee and the Litecoin Core Development Team. At that time, the disparity between LTC and BTC was only in the encryption classifier – Litecoin uses Scrypt instead of the usual SHA-256.
At the same time, the complexity of the Bitcoin network increased markedly and required a more profound mining kit. Many miners were interested in Litecoin especially, because, in order to get it, it needed only a good processor. But so far, the conditions for mining Litecoin have also increased, and yet LTC indicates no progress in terms of cost in 2020.
Nowadays Litecoin mining is a proceeding, where the main task for miners is to verify sent transactions and support the network’s operability with the help of special computing equipment, along with which LTC is mined (emitted). The Scrypt computation is a basis for this digital coins mining. Miners prefer to exploit ASIC hardware, as the most efficient appliance.
Litecoin Mining Prospects in 2019-2020. The future predictions:
Let’s start with the last years data, and its detailed overview.
The first phase of the mining era was the most auspicious time for all who decided to invest in mining. Literally, given that the mining power was not so high, miners could get a substantial amount of coins in a few months. For instance, the initial Litecoin mining reward, before the halving, was 50 LTC. It is logical to grasp why many people, regardless of their financial state, invested in mining gear.
Currently, Litecoin’s blocks went through the halving twice. The first one divided blocks with a reward of 25 LTC. In August 2019, the reward for miners has reached another value, which is 12.5 LTC. The current litecoin price 2019 is around $44-45 with slight daily changes, according to the market’s data.
While LTC mining was available through a combination of powerful CPUs and GPUs, top miners invested in ASIC hardware. Over time, this equipment proved to be profitable, and many Litecoin miners had an excellent opportunity to store Litecoins in large amounts.
The mining power has intensified with each halving, yet miners found out that the continuation of this activity is no longer can bring profits, as it did two-three years ago. However, it does not imply that the community of miners gave up and stopped the mining. Many experts tend to presume that litecoin price 2020 was going to be more attractive for investors.
So, what is the current situation with Litecoin mining for 2020?
By 2020, there are only two methods left for truly profitable Litecoin mining which are building a farm on video cards and buying an ASIC. Why? The reasons are quite transparent, the most used and popular crypto mining devices are ASIC ones. They were designed right for this purpose. ASICs typically come with mining software pre-installed on the integrated controller and do not require any extra configurations.
The most trustworthy devices to mine Litecoin in 2020:
The devices listed above are considered the most popular and used among miners. Of course, their cost may seem quite high currents, but do not forget the fact that with the help of these features you can earn. Whether it is worth it or not is up to you.
We won’t make a detailed overview of the devices because this article is an educational one. In case if you need more information to buy the personal mining machine just Google it – the internet is full of useful information.
Litecoin Mining – GPU or ASIC?
As we mentioned above, miners had two methods to get Litecoin – the mining via powerful GPUs and ASIC. Naturally, the two most prominent companies in the world – AMD and NVidia – focused on releasing specialized GPUs for miners. NVidia proved to be a better supplier since its equipment sales demonstrated an excellent result. And it’s not all, many people invested to make a joint so-called cryptocurrency farms, for holding and stacking huge number of GPUs for the greatest profit as even possible. Such farms expect to gain profits, and current predictions for the end of 2020 quite promising and fascinating.
The other method for taking profits was the purchase of ASIC hardware by the miners. If comparing to NVidia and AMD products, the ASIC was the next phase of the virtual money mining development. In terms of price, such equipment was higher, in a range from $1,500 to $5,000.
Litecoin mining is still a trend for most miners, yet some people understand that the profit is worse in comparison to previous years. Nonetheless, this cryptocurrency is already holding comfortable positions. It makes analysts and digital currency enthusiasts believe that litecoin 2021 value will be the main focus of investments.
This article is intended as a news item to inform our readers of various events and developments that affect, or that might in the future affect, the value of the cryptocurrency described above. The information contained herein is not intended to provide, and it does not provide, sufficient information to form the basis for an investment decision, and you should not rely on this information for that purpose.