A few days back we published a piece about the first Litecoin hard fork “LitecoinCash” and, oh boy, we have been grilled for that. Due to the not yet confirmed support of exchanges and existing Litecoin wallets, the LCC team describes a way of claiming the free coins on their website by the use of their wallet – which needs the private key. As one should know, you never put the private key into any other places like website or wallets, and as Crypto is nowadays wild west, the concerns of the community are not baseless. However, as we researched the topic, we found several facts that made us think LitecoinCash is not a scam, but a team of knowledgeable nerds with profound mining experience and some kind of unfortunate marketing issues. While the slightly hysterical reaction by the community is understandable, we think it is important to stay grounded, take a deep breath and sober look at the facts to provide a balanced view – and we think it is just fair to give LitecoinCash a voice to clear the air. So, we sat down with Tanner, the development lead of the Litecoin Cash Team, and asked them all the uncomfortable questions…
SmartOptions.io: Hello Tanner, thank you for taking the time to answer some questions. I think we should start with some basics to understand the history of LitecoinCash. Please explain how the idea for LCC was born. The purpose of an SHA256 mineable coins sounds somehow nuts nowadays.
Tanner [LitecoinCash]: Looking through the CoinMarketCap front page, we were really surprised that there were so few choices for SHA256 miners.
We couldn’t find a single coin that uses SHA256 while having fast block times and an effective retargeting algorithm, and that was very interesting to us. Wherever you weigh in on SHA256 vs Scrypt, you can’t deny there’s a whole lot of SHA256 mining hardware out there.
At the moment, those miners have extremely limited choices for where to send their hashpower; realistically, it’s going to be Bitcoin or Bitcoin Cash. In both cases, there are inconveniences. Blocks are slow. Difficulty retargeting, while improved in Bitcoin Cash, is not great.
There seemed to be a niche to be filled. While there is no point creating a coin just for miners, it’s true that what’s good for miners is good for the network, and good for everyday use. Bringing together the best ideas from different places, including Evan Duffield’s DarkGravity difficulty adjustment, creates a really practical coin for trade and everyday use, with enough benefits to attract SHA256 miners.
Community engagement is essential. We realised that a new, viable SHA256 option could encourage people with older generation SHA256 hardware that’s no longer capable of mining Bitcoin to dust off their rigs, which would help to create momentum for the project.
Given the above, we thought it would be great to have a large and well-distributed money supply from launch. We really don’t like the concept of doing an ICO, whether airdropping free coins to anyone who wants them or encouraging people to buy them.
We realised that what we really wanted was a mature, widely-spread distribution. And what better way to get that than to use a few years of blockchain from a popular coin?
Whether it’s for a quick profit or because they’re genuinely bringing something new to the table, everybody is forking Bitcoin, and the market has become saturated with Bitcoin forks. However, they have taught the market how hard forks generally work, and what to expect. Not to mention, while we want a wide distribution, we don’t feel the need to have 140Gb of it!
It seemed an obvious choice to look to Litecoin for our initial distribution.
Suddenly, this thought process had led to a SHA256 fork of Litecoin – which admittedly does sound nuts! The perverse cosmic joke of that only attracted us to the idea even more.
SmartOptions.io: Fast transactions and micro fees – that sounds almost too good to be true. How do you want to achieve those high goals?
Tanner [LitecoinCash]: Litecoin’s 2.5 minute block target is great and allows for fast transactions. The issue is the difficulty adjustment, which leads to that target block time not being met very accurately. This can be nicely demonstrated by the countdown to our fork block on our website, which has slipped over 6 hours earlier over the last few days, and is now looking like being Sunday evening instead of Monday morning!
All this is because Litecoin’s mining difficulty is only adjusted every 2016 blocks. This means the network can’t deal very effectively with rapid changes in available hashpower. We address that by using DarkGravity, which adjusts the difficulty target every block to give more consistent block times however much hashpower is available on the network.
Cutting transaction fees is a sweetener to encourage day-to-day usage, which of course is good for the whole community.
SmartOptions.io: We wrote about your hard fork and got many emails why we are supporting this “scam”. We also have been banned from some few Reddit groups for posting the link to our article. We are still confident that this assumption is wrong and think people smell a scam here due to multiple factors. The first point of critique is that you need to import your private key into your wallet, which is a no-go for the most. Why don’t you offer other possibilities to claim the coins?
Tanner [LitecoinCash]: Bringing a hard fork to Litecoin puts us first in the space and with that comes a great opportunity (even responsibility) to educate users.
At every step, we encourage “safe forking”. The golden rule is that you never, ever use a private key that holds live coins to claim fork coins — including ours! After the fork block, the very first thing you do is move your Litecoin to a new address, so that the private key which held your coins during the fork is now worthless on the Litecoin network. That key, worth zero Litecoin, is what you import into the Litecoin Cash wallet to claim your coins.
There will be Litecoin forks that are scams. I absolutely understand why people are screaming “scam!”. If absolutely nothing else, we’ll be the “tutorial level” for the Litecoin community, because we’re adamant that we’re going to teach people how not to get scammed.
Yes, the ideal solution is for exchanges to automatically credit LCC based on LTC balance at the fork block, and we are in active discussions. Yes, it would be absolutely wonderful to have some better advice for Ledger users than “send your coins to a desktop wallet just for the duration of the fork” (see our website for more detailed Ledger info). Again, we’re in discussions there. You can help by adding your voice! Contact your exchange or hardware wallet provider and ask when they’ll be adding support for Litecoin Cash
SmartOptions.Io: That makes sense, so we take that you need the support of exchanges to offer other opportunities (without the use of a private key) to claim the coins. On another note, the marketing leaves questions open and raised some eyebrows. No real whitepaper, the “unauthorized” use of the name Litecoin, the name that reminds of another unpopular hard forked coin (Bitcoin Cash). Can you understand that the summary of these points leaves the crypto community, let’s say skeptical?
Tanner [LitecoinCash]: Oh, absolutely. We’re claiming no association with or connection to the Litecoin dev team, apart from being fans (and the fact that we’ll share 1371111 blocks of transaction history). For the record, we’re not connected to the BCH guys either.
Litecoin Cash isn’t intended to attack Litecoin in any way. Before the first Bitcoin hard forks, it was unclear whether both blockchains would survive or one would be killed off. Some BTC forks were launched aggressively with the intent that they would displace or even replace Bitcoin; some were launched with explicitly complementary intents and no desire to dethrone the parent coin. We’re very much in the latter category. Remember the origin story of Litecoin itself, an experimental code fork of Bitcoin that turned out great.
As to the name itself, the LCC team understands the knee-jerk negative reaction. However, it’s become customary in recent months to prefix the name of a blockchain-level fork with the name of the coin you’re forking from. I’m not saying that’s an ideal situation, but it’s a convention that has formed very quickly. What we do like is that it’s instantly understood: “Litecoin Cash? Oh, must be a Litecoin fork.”
The specific choice of “Cash” is very bold. There were three reasons behind that. The symmetry was nice; the first BTC fork was Bitcoin Cash. The sheer poke-the-wasp-nest effect does appeal to the team’s collective sense of humour, in the same way that forking Litecoin and making it SHA256 does. I think there’s value in branding that has some inherit crooked humour in it if you look at it a certain way, without going out-and-out meme based or being too obviously “funny”.
The final reason for the “Cash” is really the most brazen. Googling around shows many things named “Litecoin Cash” that are not us. Here are a few:
http://litecoincash.io/ (This one’s an Ethereum token!)
Those do indeed look incredibly scammy. Apologies to any of those projects who are actually genuine, but having seen them we decided it was best to prevent them existing by claiming the Litecoin Cash brand and racing past them. We completely understand how audacious that is, and that we would initially meet the same ridicule I can only imagine those projects did.
SmartOptions.Io: There have been quite a few airdrop and “hard fork” scams. Do you have a message for all the doubters? How do you want to gain the trust back from the community?
Tanner [LitecoinCash]: Really, it all comes down to safe forking. If there’s any message we’d send to doubters, it would just be “that’s great – doubt is good”.
Our code will be made open the same instant we release the wallet. There’s no need to claim instantly; if you’re not sure, take your time and see how the experience of others goes. Your LCC aren’t going anywhere, they’ll still be there for you.
SmartOptions.Io: In research for the article we requested some exchanges if they will support the hard fork. The answers (if we got any) have been negative. Are you still trying to convince the exchanges to support the hard fork? Which exchanges are you currently negotiating with for a listing?
Tanner [LitecoinCash]: Yes, we are actively negotiating with several exchanges. It wouldn’t be fair for me to name any names at this point.
SmartOptions.Io: We know you are fans of the original Litecoin and Charlie Lee. He was unfortunately not very happy about the hard fork news. Actually, he even called you out as a scam indirectly. How did that feel for you when you read that?
Tanner [LitecoinCash]: We expected this. Charlie Lee’s right to be as skeptical as anyone else. We’re certainly not offended!
The thing is, it’s not really necessary to trust us. Practice safe forking, and don’t trust any fork wallet with a private key that holds active coins from the parent chain.
I hope that if nothing else, Mr. Lee will appreciate our efforts at user education.
SmartOptions.Io: Which plans do you follow for the future of LitecoinCash? Where do you see LCC in 2-3 years?
Tanner [LitecoinCash]: We’re very keen to stay as close as possible to upstream code, to be able to keep very up to date and include in LCC all the fun new toys that the Bitcoin network enjoys.
The view at 2-3 years out really depends on how much adoption Litecoin Cash gets.
It’s much easier to talk about the next 2-3 months, which will see us growing the team, continuing to liaise with exchanges, and launching SPV wallets (light wallets). We’ll also be examining transaction privacy layers. That’s an aspect that’s seen even more experimentation in the altcoin space than difficulty adjustment, but none of the existing solutions quite nail it.
As for the next 2-3 weeks, I think they’re going to be a wild ride 🙂
SmartOptions.Io: Thank you so much for taking the time to answer our questions.