Litecoin is a popular alternative to Bitcoin (referred to often as Bitcoins little brother) and although it is developed on the same open source code as Bitcoin there are some fundamental differences between the two.
The biggest difference for miners of cryptocurrencies is the speed at which Litecoin generates blocks. Litecoin generates and processes blocks about four times faster than Bitcoin does, resulting in a larger number of completed transactions over a period of time.
There are also four times as many Litecoin’s in circulation compared to Bitcoins ( 21 million versus 84 million) so the value of a Litecoin is substantially less than that of a Bitcoin.
This article will provide an overview of the litecoin mining hardware required to get started.
The biggest difference for miners between Bitcoin and Litecoin is that the hashing algorithm used to solve a block is different. Bitcoin uses SHA-256 (Secure Hash Algorithm 2) while Litecoin uses a Scrypt.
Miners make money when their computers use their CPU to solve a block and coins are paid out as a result and as Litecoin solves transactions differently to Bitcoin, different mining rigs (Hardware and Software) are required to mine Litecoin.
For miners wishing to mine for Litecoin, there is a calculator that can help you determine the profitability of mining for Litecoin before you start.
Litecoin Mining Hardware
Obtaining the right hardware to mine Litecoin is essential and you can choose to build your own rig from various parts or purchase an ASIC script mining rig as a ready to go unit.
Building your own Litecoin mining rig (see guidelines at here) is the less expensive of the two options, but the most time consuming. It can be done by starting with a basic home computer with a motherboard, power supply, a 2.8 GHZ processor and memory of at least 4GB.
The components bought separately on Amazon will cost you about $530. Building up your own rig can be difficult as you need a minimum of two graphics cards (four to five is however recommended) to be connected.
Your system RAM needs to be at least as much the RAM of the combined graphics cards. A good quality graphics card will set you back about $200 each. To build a rig on your own will cost you a total of approximately $1332.00 if you have four graphics cards. (Based on the current prices on Amazon excluding shipping)
Alternatively you can purchase a ready made Scrypt ASIC mining rig such as the Antminer (which is recommended as the best Litecoin mining rig available), also available on Amazon for about $5500.00.
The advantages of buying an already constructed rig is the speed at which you can start mining as well as the assurance that the rig will work as promised. However the cost is greater than when building your own rig. Potential miners could also investigate the option of cloud mining instead of owning a rig.
As Dogecoin is based on Litecoin, it is possible to use litecoin mining hardware to mine Dogecoin. Read the full article for more info on how to mine doge.
Once you have a mining rig, you should look at the possibility of solo mining versus joining a Litecoin mining pool (where processing power of a group of miners is combined to solve more blocks faster),such as litecoinpool, https://www.litecoinpool.org/.
There are many mining pools available for you to join.