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Crypto News

Third “Halving” of Litecoin, a Significant Development for 12-Year-Old Blockchain

Author

Jay Solano

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Reading time

3 mins
Last update

Author

Jay Solano

Tags

Reading time

3 mins
Last update

Author

Jay Solano

Tags

Reading time

3 mins
Last update

litecoin

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When transaction block 2,520,000 was reached Wednesday, the blockchain’s “halving,” when bitcoin issuance is cut in half every four years, occurred.

Litecoin is a Bitcoin “fork” from 2011. On Wednesday, the blockchain cut its LTC cryptocurrency issuance in half for the third time in its 12-year history.

One of the oldest and largest blockchains, Litecoin, saw its third “halving” in its 12-year history, a major milestone for a project known as “digital silver” to Bitcoin’s “digital gold.”

The blockchain’s lifespan event was programmed into the decentralized network’s programming to occur every four years. The “block subsidy”—the predefined incentive miners receive for processing transactions and protecting the network—dropped from 12.5 litecoin (LTC) to 6.25 LTC.

The project gains mass acceptance without compromising blockchain security by cutting miners’ earnings.

According to litecoinspace.org, the reduction occurred at block height 2,520,000 on Wednesday at 15:06 UTC (11:06 am ET). Since 2011, the network had been halved three times.

Litecoin’s vintage and longevity have kept crypto veterans thinking about the project. At $7 billion, LTC is one of the most valued cryptocurrencies.

Litecoin also secures Dogecoin, a top-20 project with a $14 billion market valuation that was founded as a joke in 2014. Elon Musk, founder of Tesla and owner of X, formerly Twitter, frequently discusses dogecoin.

Bitcoin and Litecoin “miners” receive variable transaction fees and a predetermined “subsidy” that is halved every four years. (Litecoin generates blocks every 840,000 transaction blocks, taking 2.5 minutes each.)

Miners received a 50% subsidy decrease on Wednesday, which they expected.

Disinflationary halvings enable Litecoin founder Charlie Lee achieve mass acceptance without compromising network security.

“Satoshi chose four-year block halving to allow the network to grow before the fees take over.” Lee explained last week. “On-chain usage will generate enough fees. Miners will be paid enough to keep the network secure.

In 2011, Lee saw a story about how Bitcoin was the only payment option on Silk Road, a drug bazaar.

He was so pleased that when he started his own project, he duplicated Satoshi Nakamoto’s code, including many of the original blockchain’s important features. One proposed implementing periodic “halvings” into the blockchain’s programming to reduce Bitcoin issuance by 50% every four years.

Bobby Lee, Charlie’s older brother, is Ballet’s CEO and co-founder. Ballet makes crypto “cold storage” cards. The pair created 500 99.9% silver collectable cards to celebrate the blockchain’s third halving.

Silver cards alone may be worth $40, but filled with 6.25 LTC, they would be worth $581. Buyers would value the premium because they are expected to sell for $1,000. Charlie Lee said the Litecoin Foundation will get all sale profits to promote blockchain adoption and development.

Charlie Lee said it’s silver. “Litecoin is worth silver even if it goes to zero.”

Litecoin is worth $7 billion. LTC was trading at $89.02, down 4% in 24 hours.

“Like I’ve said, a lot of the price action is a self-fulfilling prophecy,” Charlie Lee remarked. People will buy before or after the halving because they think it will raise prices.

“For Bitcoin and litecoin, sometimes the price went up before, sometimes it runs up afterwards,” he said. Sometimes it doesn’t matter. It depends on market reaction to the halving.”