For many, the concept of Litecoin mining is very strange. How can you dig a digital currency? Why is that necessary and how do you start it?

In this chapter we will tell you a bit more about how Litecoin mining works, why it is essential for the network and finally how you can start with the mines of Bitcoin Silver.

How does Litecoin mining work?

It sounds very strange to most people, the idea that Litecoins can be mined can be very alien for a lot of people. Yet this is certainly possible and also entirely legal. Instead . Which basically means that the miners are asked by the Litecoin network to solve a set of math questions with their computer.

Within a Blockchain there is no central point where everything is kept in terms of transactions. This means that there must be a verification process within the network to check all incoming transactions for correctness and fraud.

This verification process is what Litecoin mining means. All miners within the Litecoin network use their computational means to decipher and control every new block cryptographically. This deciphering process is nothing more than that their computers always gambling the answer until one of the miners gambles the correct answer.

Scrypt Mining

Scrypt was introduced into the  cryptocurrency world with the introduction of Litecoin. Scrypt stands forscrypt(p) = SHA256(p + SMix(SHA256(p))), which basically means SHA256 with extra steps. The true benefits of the Scrypt algorithm included lower block times than Bitcoin, and ASIC resistance.

Funnily enough, Scrypt was implemented as a solution to Bitcoin’s GPU mining, which was seen as too centralised for Litecoins developers. This was the reason Scrypt was implemented to prevent Litecoin from being mined using GPU’s. However for whatever reason, Scrypt never achieved that goal and GPU miners flooded the network in any case. The unique advantage of Scrypt is that it allows you to use CPU and GPU power when mining, however GPU is the most efficient and thusly the more commonly used.

Scrypt was originally invented by Colin Percival for the Tarsnap online backup service. This service claims that Scrypt makes it tremendously expensive for custom hardware attacks to be conducted and is thousands of times more secure than many popular cryptographic algorithms in use today, such as Bitcoin’s SHA256.

The reason for this is because scrypt requires attackers to either use more memory to conduct a brute force attack, or use less memory and conduct a slower attack, this trade off is intentional and makes Scrypt very secure. SMix (the extra step we talked about) shuffles around data, in a way that’s designed to be incredibly difficult to optimise. This makes it harder for attackers to guess passwords hashed by scrypt, and because each guess will take lots of time to compute, there is no known way to get around that.

It’s no wonder it was first implemented by Litecoin creator Charlie Lee as the coins algorithm.

For miners, Scrypt is considered to be the most GPU friendly and the vast majority of Scrypt miners available on the market are GPU miners. Scrypt takes up more computational memory than SHA-256, however this is offset by the fact that Scrypt mining uses up much less electricity than SHA-256 mining, which means you can drive it harder. With less electricity comes lower heat output and less noise coming from your miners, however mining Scrypt can still increase your Air Conditioning bills during the Summer, but, it will lower your heater bills in the Winter.

ASIC’s for Scrypt mining are on the market, so if you are a GPU miner mining Scrypt, you may be in for some competition. As more and more Scrypt ASIC’s are expected to hit the market, expect the difficulty to rise on Scrypt coins and your market shares to decrease, along with your profits.

Scrypt coins are currently still profitable and can be an excellent investment if you have the right GPU equipment, however if you are interested in mining Scrypt you may want to consider investing in an ASIC miner instead. Some ASIC’s can even mine SHA-256 and Scrypt simultaneously, so consider ASIC’s as an option if you are considering mining a Scrypt coin.

Start with Litecoin mining

You can tackle litecoins in two ways, The first way is to buy the hardware yourself to mine litecoins. The second option is to use a Litecoin Cloud Mining service.

A Cloud service makes mining Litecoins a very simple process. However, it does have the disadvantage that you yourself have no control over the hardware and you cannot optimise the rig.

This can make a huge difference, because profitable litecoin mines are nothing more than a simple game of optimisation. How many litecoins can you mines for as little power as possible?


Cloud mining is a new phenomenon which is extremely attractive for people who are not very technical or do not want to run their own mining rig.

In addition, using a Cloud mining service is also attractive if you live in a country where electricity costs are on the high side. Especially when you compare it with, for example, America. Where the costs of electricity are simply much lower.

In that case it’s very attractive to use such a service. A Cloud mining provider actually offers their computational power. That means that you can rent a rig at their regular Hashrate for a certain period of time. For this you pay for a contract of, for example, a year. After which you will see a gradual flow of litecoins in your wallet.

You can then calculate how long you mine with your cloudminer to make a profit with the calculator below. Enter the hashrate you want to rent into the calculator and then you have a good indication. You can also play with what happens when the price rises with this calculator.

Our recommended  Cloud mining providers are 

If you choose cloud mining, you can skip to steps 2 and 3.



In order to assemble your own Litecoin mining rig, you first need a set of efficient graphics cards. With efficiency we mean a card that has a high hashrate, but low energy consumption. You do not have much on a card that has a huge hashrate, but its use is more than its revenue.

An Litecoin mining rig with 4 GPUs

Some GPUs to consider are:

You can use the hashrate along with your energy costs of the GPU to find the most optimal GPU for you with this calculator .


When it comes to RAM memory you really need the minimum amount for an ethereum miner. You have more than enough to 4GB. RAM is important at the beginning when you are syncing with the blockchain. After that, it no longer has an important function.


Because our miner works on graphics power to minimise, the processor is not that important for its task. We do not recommend buying the cheapest processor, the processor helps you with the setting up of the mining rig and it also speeds up possible reboots.


When the hardware has arrived from your Litecoin miner, it’s time to download and install the special software for mining. There are a lot of options in terms of software when it comes to mining litecoins. At the moment the two most popular are CGMiner and BFGMiner; both of which are a cmd program.

Cmd programs, or command line programs, work as the name suggests via the command line of your computer.

Not everyone likes to work from the command line.

Not everyone likes to work from the command line.

If you prefer a program with a GUI, or an interface with buttons that is friendlier for non-programmers, then software like EasyMiner is better suited to mining Litecoins.


If you have finally set up your litecoin mining rig and you are ready to mine, it’s time to choose a mining pool. Using a mining pool is actually an optional step, but realistically it is a must .

A mining pool is a group of Litecoin miners who together solve a block and distribute the reward fairly. You can choose to work without a mining pool, but then it can take years to get a reward; with a greater chance of never.

Some examples of Litecoin mining pools are:


The final step, and also the most important step, is creating and connecting your litecoin miner with your Litecoin wallet. In one of the previous chapters, we discussed what the best Litecoin wallet is, and what a Litecoin wallet is.


Posted by Richard P

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