Learn Cryptocurrency
13 Jan 2021

How to Mine Litecoin: Beginners Guide to Mine LTC

Devansh Sinhal

Litecoin is a crypto coin that was first invented to be a ‘lite’ version of Bitcoin with a few improvements and tweaks, designed to cater to a larger user base. However, over time, the unique selling point of the currency has lost most of its significance and is now one of the many coins and tokens out there. However, it still continues to command a decent market cap in the crypto market, ranking at the 16th position right below Chainlink (LINK) and above Bitcoin Cash (BCH).

Just like any other cryptocurrency, the supply of new coins into the market is done by the process of mining. Miners use highly sophisticated tools and computing equipment to generate new Litecoins by verifying transactions that take place on its online blockchain ledger. This process, although very complicated, keeps the servers running and the coin in existence.

In this blog, we will highlight the various nuances that exist in the mining process for Litecoin, and crypto mining in general, and will tell you everything you need to know about how new Litecoins are brought into circulation in the market. No matter what your motivations for Litecoin mining are, this blog will give you all the information you need to get started on the process right away.

Key Takeaways

  • Litecoin mining is the way to keep the supply of Litecoin in the market up and keep the network decentralised
  • Block rewards keep miners incentivised to verify transactions
  • Solo mining, mining pools, or cloud mining are the various ways in which one can mine Litecoin
  • ASICs or GPUs, along with specific software may be required to mine litecoin on your computer. Individual computers using GPUs or CPUs have an extremely low chance of actually hitting the block reward

What Is Litecoin Mining?

In most proof-of-work currencies like Litecoin and Bitcoin, there are people responsible for maintaining the blockchain ledger and keeping a record of all the transactions that were ever made on the network. These people are called miners. They receive transaction data broadcasted by various participants in the blockchain and assemble those transactions in a logical manner. When this is done, miners race amongst themselves to find the solution to a set of complex mathematical equations. The first miner to crack the code gets the block reward in the respective network’s currency.

Mining is the name attributed to this entire process. The reason why Litecoins are mined is simple: to keep the network running. If the blockchain does not have miners to constantly verify transactions and keep creating interlocking blocks, the network itself will lose all significance.

Mining is the only way to generate new Litecoins for the market and keep the supply up. Since Litecoins are limited in number and will eventually be completely mined, miners will still get paid via network transaction fees for their work. To maximize the chances of miners getting paid for verifying these transactions, they have developed gear specifically designed to tackle these complex mathematical problems. Most miners have also pooled their resources and concentrated in places where resources are cheap to maximize profits.

How To Mine Litecoin?

Mining is an incredibly complicated and resource-intensive process. Most individuals with regular, everyday computers simply do not have access to the kind of computing power they need to have a chance at earning the block reward. Since miners are competing amongst themselves all the time, it is understandable that the miner (or mining pool) that has the highest computing power stands the highest chance of winning the reward. These machines often consist of multiple dedicated GPUs and cooling systems integrated with each other into a single system specifically designed to blurt out possible hashes. As of September 2021, with an average work computer, individuals can never hope to win the reward, considering the number of resources professional miners have to invest in.

However, if you’re ready to take on the challenge of Litecoin mining and do whatever it takes, here is some information on the different types of mining in Litecoin and how you need to navigate around each one of them. We encourage you to assess the pros and cons of each of these mining methods and make the right decision regarding your mining journey.

Litecoin solo mining

Solo mining could only be profitable if you run multiple ASICs (Application Specific Integrated Circuits) and have a lot of hash power – enough to compete with the huge mining pools out there. When you’re Litecoin mining (or any other cryptocurrency for that matter) alone, you could go long periods of time without ever finding a block but when you do, you get to keep the entire reward – 25 LTC. Realistically, there’s essentially no chance of you ever earning any Litecoin through mining if all you’re using is a GPU or CPU. Most individual miners invest in multiple ASICs, which are computing equipment specifically designed for mining cryptocurrencies.

litecoin mining

Litecoin Pool Mining

Pool mining is where large numbers of miners combine their mining resources together to find blocks together. They distribute the proceeds of mining according to the hash power each individual miner contributes. Although this might sound like a neat idea, there are a lot of caveats. Even if a mining pool finds six blocks out of 20, you could have to wait for the next 400 for another one. The only advantage of being in a mining pool is that your returns on hash power stay fairly constant. However, you are always entitled to only a little share of the entire reward the pool finds.

Litecoin Cloud Mining

Cloud computing is one of the most lucrative technologies emerging in the 21st century. Cloud computing allows users to engage in and use services like processing, server capacity, database services, software and file storage options via the Internet, while paying for them just like any other service, like electricity.

Cryptocurrency mining through the cloud is known as cloud mining. This model of crypto mining is becoming more and more popular with users who want to get in on the mining bandwagon but don’t have the resources to invest in the requisite hardware and software. Here are some mining models under cloud mining:

  • Hosted mining – is the most popular one. Here, the customer rents out or leases mining hardware located in a miner’s facility to mine their own crypto. Through this model, the customers have complete control over all the crypto they’re able to mine.
  • Leased hashing power – is another model where customers can lease hashing power from miners in return for money. The process requires the customer to open an account with a cloud mining company and select the hashing power they would like to buy.

Cloud mining costs less than actually owning the hardware and software required to mine crypto yourself. However, in light of recent industry scams, this method is under consideration for further improvements in the future.

Litecoin mining software

If you’re a solo miner using ASICs to do your crypto mining, there is a high chance that your mining software will come pre-installed on your ASIC itself. However, if you are using a GPU or a CPU, you will need to select your preferred mining software on your own and install it manually. You must do this while keeping the security of the system and your coins in mind. A software package could very likely be malicious or engage in tricky behaviours and you, as a miner, have to be on the constant lookout for that. Many programs trick you into mine crypto for the software developer instead of yourself all throughout and you end up making nothing. Hence, make sure that you’re only trusting the sources you find reliable and are double-checking everything before implementing.

Litecoin mining hardware

Back in 2011, the competition for mining Bitcoin was not very widespread and it was relatively easy to mine Bitcoin with a CPU as well. However, with the competition for mining ramped up, the only way to mine Bitcoin then became the use of a GPU. Soon, that wasn’t enough either. Then, application-specific integrated circuits were developed specifically to run SHA-256 and Bitcoin mining began to move away from GPUs.

If you’re using a GPU or CPU to mine your Litecoins, you must make sure that your motivations for mining are different, because you aren’t going to make money. Using such limited hashing power could be useful for getting familiar with the mining process, the vocabulary and the concepts, and to test the waters before you decide to invest huge amounts of money into actual mining equipment.

How Litecoin Mining Works

People who are interested in mining Litecoin can go about entering space in several different ways. Although the procedure for generating block rewards remains the same, the process by which miners approach the verification of transactions differs.

  • Solo mining – Solo miners utilise their own Litecoin mining equipment, usually in the form of ASICs to generate block rewards. While the chances for finding a block for an individual miner are extremely low, the miner gets to keep the entire reward – 25 LTC – if they happen to find one.
  • Mining pools – Mining pools are huge collaboratives of miners who pool their hashing power together to find blocks. When they do find blocks, the reward is divided into the participants proportional to the amount of hashing power they contributed.
  • Cloud mining – Cloud mining can be used when customers wish to purchase or rent out hardware or hashing power from other miners or mining companies and mine for crypto themselves. This is an emerging form of mining but it still has a lot of challenges to go through to become a viable option for the vast majority of miners out there.

Free Litecoin Mining

Free Litecoin mining software is available on the internet for anyone to use. If you are a user of a regular computer that runs on GPUs and CPUs, you can also use your hash rate – however, limited – to try and find blocks of Litecoin. However, to have any potential for earning money through Litecoin mining hardware, you need to invest in either a litecoin mining pool free or look up the best free litecoin mining sites online for more information.

Litecoin Mining Benefits

Here are some of the benefits of mining Litecoin:

  • No direct investment – Usually, to own Litecoin, you need to put down your own money in an exchange and buy Litecoin through fiat. However, through LItecoin mining, you could theoretically earn cryptocurrency without having to invest money directly in way of buying them
  • Block rewards – The rewards for finding blocks on the network are usually high. For Litecoin, the block reward is 25 LTC.
  • The network stays secure – Mining for cryptocurrencies is the only surefire way of keeping the blockchain running. If the verification of transactions stops at any point, the entire system collapses. Hence, as a miner, you get to directly contribute to the propagation of Litecoin
  • Mining also keeps the coin decentralised – Theoretically, as the number of miners in a network increases, the competition for guessing the correct hash for finding a block increases as well. Since every miner works anonymously and selfishly to ensure their own reward, in the end, the coin becomes more decentralised as a whole and hence, more secure
  • Avenues for learning – Mining is one of the most fundamental processes behind the working of crypto and understanding mining makes one aware of the intricacies of crypto and the core technologies it is based on. Hence, the avenues for learning about crypto through mining are infinite.

Wrapping It Up

Litecoin mining, or even mining in general, is one of the most fundamental processes that are required to keep cryptocurrencies running. It is through mining that most new coins come into supply and their demand keeps increasing throughout the years. If you’re a new investor looking to buy Litecoin or other cryptocurrencies before you start to mine them, CoinSwitch Kuber is the best app for you. Not only is it the largest exchange in India with more than 10 million users, but it also offers you more than 100 different coins and tokens (including Litecoin) for trading or investment purposes. Check out our Android or iOS app now! Or visit our website by clicking here.

Do you want to buy Litecoins in India seamlessly? Do it on CoinSwitch!

Convert your LTC to INR directly here.

Frequently Asked Questions

Is Litecoin worth mining?

Litecoin is one of the largest cryptocurrencies out there, ranking 16th in terms of market cap. Litecoin mining offers 25 LTC as a block reward for finding one, which amounts to almost INR 3,40,000 as of September 2021.

How much time does it take to mine 1 Litecoin?

One block of Litecoin is mined in about 2.5 minutes.

Is Litecoin easy to mine?

Most cryptocurrencies are very difficult to mine. Since the competition in mining keeps on increasing as more and more miners join the ranks, the hashing power required to mine one block also keeps increasing. Hence, Litecoin, or any other crypto coin for that matter, is extremely hard to mine provided you don’t have the required equipment.

How do I become a Litecoin miner?

There are several ways you can become a Litecoin miner. You could choose to:

  • Mine solo – You’d need multiple ASICs and GPUs working in tandem to actually pull off finding a block
  • Join a pool – Contribute hashing resources to the mining pool and get rewarded proportionately to your hash power contribution
  • Cloud mine – Invest in or purchase mining equipment/hashing power on the cloud and use them independently to mine Litecoin

Can I mine Litecoin on my phone?

No, even the most advanced phones in 2021 do not have the computing power required to generate the amount of hashing power required to actually find a block on the network. So as far as mining Litecoin for money goes, it’s highly unlikely that you can do it on your phone

Disclaimer : Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered as investment/financial advice from CoinSwitch. Any action taken upon the information shall be at user's own risk.

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Devansh Sinhal

Content Writer

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