Litecoin is a fork of the bitcoin source code released in 2011.
It uses Scrypt as PoW, originally introduced in the Tenebrix coin.
A Complete Guide to Understanding This Blockchain Concept
Litecoin allows for faster transactions as compared to bitcoin due to its faster block generation time of 2.5 minutes.
Also, difficulty readjustment is achieved every 3.5 days roughly due to faster block generation time.
Scrypt is a sequentially memory hard function that is the first alternative to the SHA-256-based PoW algorithm.
It was originally proposed as a Password-Based Key Derivation Function (PBKDF).
The key idea is that if the function requires a significant amount of memory to run then custom hardware such as ASICs will require more VLSI area, which would be infeasible to build.
The Scrypt algorithm requires a large array of pseudorandom bits to be held in memory and a key is derived from this in a pseudorandom fashion.
Why This Matters for Blockchain Technology
The algorithm is based on a phenomenon called Time-Memory Trade-Off (TMTO).
If memory requirements are relaxed, then it results in increased computational cost.
Put another way, TMTO shortens the running time of a program if more memory is given to it.
This trade-off makes it unfeasible for an attacker to gain more memory because it is expensive and difficult to implement on custom hardware, or if the attacker chooses not to increase memory, then it results in the algorithm running slowly due to high processing requirements.
Key Points to Remember
- Litecoin Litecoin is a fork of the bitcoin source code released in 2011.
- It uses Scrypt as PoW, originally introduced in the Tenebrix coin.
- Litecoin allows for faster transactions as compared to bitcoin due to its faster block generation time of 2.5 minutes.
- Also, difficulty readjustment is achieved every 3.5 days roughly due to faster block generation time.
Going Deeper: Advanced Concepts
This means that ASICs are difficult to build for this algorithm.
Then the output is fed to an algorithm called ROMix, which internally uses the Blockmix algorithm using the Salsa20/8 core stream cipher to fill up the memory which requires large memory to operate, thus enforcing the sequentially memory hard property.
The output from this step of the algorithm is finally fed to the PBKDF2 function again in order to produce a derived key.
Litecoin Litecoin is a fork of the bitcoin source code released in 2011. It uses Scrypt as PoW, originally introduced in the Tenebrix coin. Litecoin allows for faster transactions as compared to bitcoin due to its faster block generation time of 2.5 minutes. Also, difficulty readjustment is achieved every 3.5 days roughly due to faster block generation time. The total coin supply is 84 million. Scrypt is a sequentially memory hard function that is the first alternative to the SHA-256-based PoW algorithm. It was originally proposed as a Password-Based Key Derivation Function (PBKDF). The key idea is that if the function requires a significant amount of memory to run then custom hardware such as ASICs will require more VLSI area, which would be infeasible to build. The Scrypt algorithm requires a large array of pseudorandom bits to be held in memory and a key is derived from this in a pseudorandom fashion. The algorithm is based on a phenomenon called Time-Memory Trade-Off (TMTO). If memory requirements are relaxed, then it results in increased computational cost. Put another way, TMTO shortens the running time of a program if more memory is given to it. This trade-off makes it unfeasible for an attacker to gain more memory because it is expensive and difficult to implement on custom hardware, or if the attacker chooses not to increase memory, then it results in the algorithm running slowly due to high processing requirements. This means that ASICs are difficult to build for this algorithm. Scrypt uses the following parameters to generate a derived key (Kd): Passphrase: This is a string of characters to hash Salt: This is a random string that is provided to Scrypt functions (generally all hash functions) in order to provide a defense against brute-force dictionary attacks using rainbow tables N: This is a memory/CPU cost parameter that must be a power of 2 > 1 P: This is the parallelization parameter R: This is the block size parameter dkLen: This is the intended length of the derived key in bytes Formally, this function can be written as follows: Kd = scrypt (P, S, N, P, R, dkLen) Before applying the core Scrypt function, the algorithm takes P and S as input and applies PBKDF2 and SHA- 256-based HMAC. Then the output is fed to an algorithm called ROMix, which internally uses the Blockmix algorithm using the Salsa20/8 core stream cipher to fill up the memory which requires large memory to operate, thus enforcing the sequentially memory hard property. The output from this step of the algorithm is finally fed to the PBKDF2 function again in order to produce a derived key. This process is As distributed systems continue to evolve, a solid understanding of these core concepts becomes increasingly valuable — not just for developers, but for anyone building, investing in, or working alongside blockchain-powered systems.
Whether you are just starting your blockchain journey or deepening existing expertise, mastering these fundamentals gives you the tools to think clearly about decentralized systems and make smarter decisions in this rapidly evolving space.