Litecoin Cash, the new altcoin that is supposed to appear after this weekend’s hard fork of the Litecoin protocol, is likely a scam and users should beware, warned in a tweet the Litecoin creator Charlie Lee.
Wrote Lee: “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!”
Litecoin is the fifth-largest cryptocurrency by market cap (nearly $12.4 billion, at the time of writing this artcile). It is a decentralized token that was launched in 2011 with the idea to be faster for mining and transfering, less energy-consuming and with lower fees than Bitcoin. It also uses a different algorithm than that of Bitcoin.
Recently appeared the Litecoin Cash Foundation, which announced it will fork the Litecoin blockchain. It said the new altcoin will use the Bitcoin mining algorithm and should be 90% faster than Litecoin. The mysterious foundation also promises each Litecoin holder will receive 10 tokens of litecoin cash for every litecoin they own. Naturally, this drove the Litecoin price up, even though the Litecoin Cash is in fact not related to it in any way.
The hard forks happen when an existing blockchain is modified and as a result spawns a new one, which operates under new rules and the transactions on the old one are not recognized by it. A hard fork can be implemented to correct important security risks found in older versions of the software, to add new functionality, or to reverse transactions (as in the case with the hard fork to reverse the hack on the DAO (decentralized autonomous organization) in the Ethereum blockchain in 2016, creating Ethereum Classic). In 2017 the Bitcoin blockchain saw two hard forks, which spawned Bitcoin Gold and Bitcoin Cash.