After 18 Bitcoin hard forks were recorded last year, a first hard fork of Litecoin is now being announced. As usual, the new coin is claimed to be an improvement over the original and to revolutionize the crypto market. The digital currency will be called Litecoin Cash, likely named after Bitcoin Cash — the most successful hard fork of Bitcoin Core to date.
Shortly after EtherZero split from Ethereum, Litecoin is now facing a hard fork. The fork is planned for block height 1,371,111 on 2018-02-18 at approximately 22:53 UTC. Each Litecoin holder is expected to be able to claim Litecoin Cash at a ratio of 1:10. Because the token supply will be ten times that of Litecoin, Litecoin holders will receive ten times the amount in Litecoin Cash. The ticker symbol for Litecoin Cash will be LCC.
Why Litecoin Cash?
The official Litecoin Cash website presents the differences from the original coin in a clear comparison table:
The main claimed differences are lower transaction fees, higher speed, and changing the mining algorithm to SHA-256 (the same as Bitcoin).
From our perspective, these claims are vague and do not provide a clear added value for Litecoin.
Bitcoin Cash, the most successful hard fork of Bitcoin Core so far, for example, arose from a protest within the Bitcoin community and centered on the block size debate. And Litecoin Cash? Litecoin has never really suffered from high fees or slow confirmations. Merely switching the mining algorithm does not constitute a meaningful improvement, and changes to difficulty adjustment do not seem necessary.
The justification on the official site is particularly odd:
We believe we can offer an excellent SHA256 coin for general usage. We love Litecoin, and wanted to give something to the brave hodler community. With everyone else too busy forking Bitcoin, we decided that the Litecoin blockchain was a perfect means of intial distribution for our coin.
In our view, Litecoin Cash does not appear to have been created to solve a specific problem.
Is Litecoin Cash a scam?
Charlie Lee, founder of Litecoin, has expressed a clear opinion. On Twitter he warned that there will be no legitimate hard forks of Litecoin. Any new coin emerging from a Litecoin hard fork should, in his view, be treated as a SCAM. Neither he nor the Litecoin team are involved in this fork:
PSA: The Litecoin team and I are not forking Litecoin. Any forks that you hear about is a scam trying to confuse you to think it’s related to Litecoin. Don’t fall for it and definitely don’t enter your private keys or seed into their website or client. Be careful out there! https://t.co/qXbiIxp5Al
— Charlie Lee Ⓜ️🕸️ (@SatoshiLite) February 4, 2018
The development team behind Litecoin Cash also does not inspire confidence. The team page introduces four members, but only gives first names or nicknames and lacks verifiable social media links or other identifying information. It is therefore unclear who is actually behind the project.
Moreover, there is no meaningful improvement over the original Litecoin. Compared to the original, Litecoin Cash offers no clear practical use cases or advantages. Considering the vague claims, the anonymous team, and the absence of real benefits, we consider this Litecoin hard fork highly suspect and view it as a potential scam.
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