Litecoin is, quite often, not given enough credit for the value it provides as a cryptocurrency platform, considering its abundant functionality and use cases. The platform made significant price gains in 2017, after SegWit was successfully activated, and its founder Charlie Lee started to concentrate again on Litecoin’s further development.
Lee recently announced in his tweet that a mobile wallet / exchange “Abra” will be using Smart Contracts running on Litecoin’s network. Let’s look at the various aspects of this smart contract integration and how it could add value to the Abra app and Litecoin’s network as a whole.
Growth of the Litecoin Network
Litecoin’s platform had a tremendous growth spurt when its price went from $5 in January 2017 to an all-time high of $358, and currently, it is trading at $161 at the time of writing. That is almost 3220% growth in 15 months. This stupendous growth is mostly attributed to the return of Charlie Lee, its founder, to the “Litecoin Foundation“.
Lee has worked very hard in helping Litecoin’s network reach this level of adoption and acceptance. He was working as a “Director of Engineering at Coinbase” prior to his re-entry into Litecoin’s further development. Litecoin’s network was stagnating in development, and after he returned, it started to evolve in a fast manner. After his re-entry, the crypto-platform has seen a major improvement in development and an increased adoption rate among crypto users.
Litecoin is faster, with 2.5 minute block times, compared to Bitcoin’s 10 minutes. Also, the mining fees are low compared to Bitcoin. So, overall, it seems to have many advantages, compared to Bitcoin, especially if it is being used as a payment system.
Silver to Gold
Charlie Lee often mentions the relationship of Litecoin and Bitcoin as Silver to Gold, and that both networks have complemented each other in new technology adoption and growth. Litecoin’s network is considered by many to be the most secure network after Bitcoin, due to the abundant hash power and the strength of its network.
2017 was the game changer for both Litecoin’s and Bitcoin’s network since SegWit was activated in both of them, enabling easy collaboration between the two networks. The Lightning network, a second layer payment network built on top of a platform’s blockchain, can be used with both Bitcoin and Litecoin. Notably, for Lightening network to work properly, SegWit must be enabled.
Enabling SegWit & the Lightening Network, together, can allow for faster, cheaper, and more efficient payment systems. Additionally, both can be integrated for ease of use. Same is the case with atomic swaps, so you can swap BTC for LTC or LTC for BTC without any centralized exchange.
Charlie Lee has always emphasized on increasing usage, adoption, and the volume rather than price or market cap. He believes that the growth in usage is more important than price. He notes that price will automatically follow if the usage and adoption are high.
He then announced, in a Reddit post, that he sold all his coins to avoid any accusation of market manipulation, and to avoid price from distracting him from actual development. The Litecoin founder also released an ambitious development roadmap in 2017. According to the plan, Litecoin’s development team would like to see major businesses and platforms adopting their platform in their ecosystem.
Lee further mentioned that there would be a big surprise announcement in the days to come. Many were curious to know what this surprise was, and they were assuming that some major business would be adopting Litecoin’s network in their services. Below is the tweet from him a few days ago, mentioning the accomplishment and the yet to be completed list of goals for Litecoin. Notably, Lee has only mentioned the Abra integration as “One huge unexpected surprise”.
Litecoin’s Integration in Abra
The surprise announcement that Lee was mentioning was out finally after a prolonged suspense. He mentioned in his tweet that Abra will be using smart contracts on Litecoin’s network in about 2 weeks. Abra has chosen Litecoin’s network over Bitcoin Cash and other crypto-platforms due to its relatively more stable price and better network security. The Abra app protocol would function on Litecoin’s network as a smart contract, enabling trading of other currencies on that app.
How does it work?
The Abra app allows users to trade 20 cryptocurrencies and 50 fiat currencies, and so it is has numerous options allowing investors to easily trade or swap fiat-crypto, crypto-fiat, and crypto-crypto pairs. The app doesn’t allow you to buy a particular cryptocurrency directly. It will let you to invest only in LTC, and you can have access to other cryptocurrencies using a smart contract incorporated on Abra using the Litecoin network.
You have to invest in LTC first, and then it will lock up the LTC at the market price of the coin that you desire to trade. If that particular coin doubles in value, then you can sign and get back your profits in LTC back to your wallet. At no point in this process will you actually own that coin you are trading. You get exposure to price change instead of owning that particular coin. Moreover, the smart contract on Litecoin’s network works in such a way that synthetic currencies that you own follow the market price using the smart contract built on Litecoin’s network.
Choosing Litecoin’s Network
Abra chose Litecoin’s network over Bitcoin Cash or other networks due to its security, safety and scalability features. Its network also doesn’t encounter any outage or a sudden spike in transaction fees, which are very crucial for any crypto-platform, to give continuous uninterrupted service to users.
Litecoin is considered to be slightly less secure than Bitcoin, but there are other advantages like lower fees and faster transactions over Bitcoin. Abra believes that Litecoin’s network is the best choice for them and want to adopt it without any second thought. Below is the tweet from Lee mentioning the reason for Abra to choose Litecoin’s network over Bitcoin Cash for integration.
The above is surely a big surprise, and great news for Litecoin’s supporters. Many new coins are still struggling to get listed on exchanges, but in this case, an exchange has been added to Litecoin’s network. Surely, it is the biggest news of the year for the coin, and we will just have to see if this helps in massive adoption of Litecoin.