The first altcoin to Bitcoin is actually Namecoin. It used the same mining algorithm as Bitcoin, sha256d. After Namecoin came about a dozen other altcoins: Ixcoin, Iocoin, Solidcoin, Tenebrix, etc. This was all before Litecoin was launched. Every one of these coins are now dead.
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These altcoins experimented on different things like faster block times and different mining algorithm. Bitcoin at the time was predominantly mined by GPUs. Tenebrix brought back CPU mining with Scrypt. This is actually very important because miners are the coin's first users.
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And it's important for anyone to be able to easily mine the coin. If your miner base is large, your user base is large. And those are the users that will actively push for adoption and help make the coin succeed. The problem though with these altcoins was fairness.
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Most of these altcoins have a huge premine. Tenebrix for example had 7 million coins premined. That means the the creator has incentives to pump the coin to a high price so he/she can profit massively without much work. You get things like creators bribing exchanges for listing.
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Since the coins were just printed out of thin air, it's cheap to collude with exchanges to pump the coin. We've seen that happen with ICOs in 2017. If a coin was not premined, you get things like ninja mining. That's when a coin is released silently to friends and family.
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And it might be released without the source code or with only Windows binary. That way, a small number of users get to profit early on. This was the landscape of altcoins before Litecoin. So what I tried to do with Litecoin was to change all of that. Fairness was crucial.
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I basically took everything that's good from these altcoins (speed, CPU mining) and did a fair launch. And that's why Litecoin succeeded where others failed. The name Litecoin came to me pretty quickly. I thought of something like an Elitecoin first. Then Litecoin jumped out.
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The best part was that all the domains were available. So on 10/4/11, I bought them all on GoDaddy. What a great move in hindsight. So now, we don't have something like http://litecoin.com promoting Litecoin Cash instead of Litecoin. $38.85 well spent!
pic.twitter.com/ur0ckkHMsh
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I worked on the code for a few days. To be honest, Litecoin was not hard to code up. The hardest part was actually to create the genesis block. Satoshi never documented how he did it and the code to do that was not checked in with the Bitcoin source code.
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So I had to do some reverse engineering and managed to create the genesis block on 10/7/11 https://blockchair.com/litecoin/block/0 … What a lot of people didn't know is that I put the headline of Steve Job's death in the genesis hash. This proves that the genesis block was created after 10/5/11.pic.twitter.com/Zn7tnRBgUM
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On 10/8/11, I announced Litecoin to http://bitcointalk.org . BitcoinTalk is basically the only place that people chatted about Bitcoin. No one used reddit, Twitter, Facebook. The code was available for anyone to download and compile. So they can check the code to make sure.pic.twitter.com/JJbF1QhhHL
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Here's the launch thread: https://bitcointalk.org/index.php?topic=47417.0 … Binaries were also available for those that trusted me and didn't know how to compile the code for themselves. People were able to immediately mine on testnet to make sure everything works on their system. This is very important.
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That way everyone can be prepared to mine at launch. So the launch would be fair. To accomplish this, I of course had to share the genesis block with everyone. But I can't just do that because people can mine a long chain in private from that genesis block.
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At launch, if they release that long chain, it will become the longest chain and they would win all those early blocks. So what I did was to lock in a block after the genesis block. I mined block 2 and 3 and hard coded those hashes in the code but I withheld a couple parameters.
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Without those 2 parameters, one cannot start mining on the mainnet, but they can easily mine on testnet. So I lied, there was a 2 block premine of 100 coins.
The genesis coins cannot be spent.
Then I did a poll on what time we should launch the coin:
https://bitcointalk.org/index.php?topic=47418.0 …pic.twitter.com/AuXkqMB4QT
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I did everything I could think of to make this as fair as possible. As you can see, the winning time was not what I voted on. It actually was a very inconvenient time for me! But crowd (albeit very small) has spoken. So I prepared everything for to launch at that time.
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Over the next few days, I did everything to help people get their system set up. A few minutes before the actual launch time, I posted this. Of course this was a link to Rick Astley's video. I had to.
pic.twitter.com/isJIRPhEDv
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At launch, I posted the config paramters that were needed to mine on mainnet. All everyone had to do was paste that into their litecoin config file, restart their client, and they will be happily mining real LTC. Of course, there was a mad rush of people mining LTC at the start.pic.twitter.com/ZyUcQ1UEe3
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There was quite a bit of chain orphaning as the difficulty was set a bit low. There was no way for me to predict how successful the launch was going to be. I myself only managed to get a handful of blocks. People for the most part were very happy with how the launch went.
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I think I managed to pull off the fairest launch of any coin. And that is one of the biggest reasons why Litecoin succeeded. Surprisingly, very very few coins copied Litecoin's launch. Ok, that's it for now. I will tweet more later about what happened between launch and now.
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I forgot to mention that I chose Litecoin because Litecoin is the lighter version of Bitcoin. It's faster, cheaper, and easier to use. And we got to see a young & unknown (at the time)
@VitalikButerin hating on the name. I prefer Litecoin over Etherium. Wait, is it Ethereum?
pic.twitter.com/kCLUUNbiel
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The original logo was inspired by this image. Cool image but it didn't translate well into a good looking logo. https://bitcointalk.org/index.php?topic=47417.msg585829#msg585829 … But we did get some cool acrylic Litecoin collectible made by Mike Caldwell (
@casascius), make of Casascius physical bitcoin.pic.twitter.com/cU8B9xzIQC
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The second logo was designed by
@mjbmetals. I still like that quite a lot. It looks well next to that Bitcoin logo. https://bitcointalk.org/index.php?topic=140642.0 …pic.twitter.com/Uy5qpl8JUP
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And the current logo is designed by Robbie Coleman (
@robertfcoleman) and his team. Of course being decentralized, there are many other logos that people have created and used. Some are pretty wacky. And people can use whatever logo they want and I can't do anything about it.
pic.twitter.com/M7FgBcGPum
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Soon after the launch, Litecoin was added to BTC-e. That helped a lot as miners had access to liquidity pretty quickly. Litecoin quickly become one of the most popular coin on BTC-e. The BTC-e chat/troll box was one of the most innovative thing at the time. Many have copied it.pic.twitter.com/Aq97pG2IqD
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From 2011 to 2013, I spent a lot of time supporting Litecoin's early growth and pushed for adoption wherever I can. I pretty much talked to all the exchanges to support LTC. I realized that liquidity is super important for a coin. Without liquidity, you can't do anything.
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Merchants and merchant processors can't accept a coin if there's no liquidity. Because they have to cash out to fiat when they accept the cryptocurrency, lack of liquidity makes it hard to sell the coin without moving the price too much.
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In May of 2013, Bitfinex launched support for Litecoin. https://www.financemagnates.com/cryptocurrency/trading/bitfinex-launches-litecoin-trading/ … This was a huge deal for Litecoin. It’s the first major exchange to support LTC.
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At the Bitcoin 2013 conference, I remember attending a talk by Bitstamp Co-Founder and CEO Nejc Kodrič(
@nejc_kodric). During the Q&A after the talk, I asked him if Bitstamp will add Litecoin. I think he just chuckled and went to the next question.Show this thread -
I remember thinking to myself that one day they will add Litecoin. And it will be because it was the right business decision for them to add LTC. And that did happen but 4 years later in June of 2017:https://blog.bitstamp.net/post/let-there-be-litecoin …
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on the history of Litecoin from my perspective.
My memory of events can be hazy at times, so for those mentioned, feel free to add or correct anything I say. Here goes...