What Is Litecoin? Similar to Bitcoin, Litecoin is a cryptocurrency for digital payment transactions utilizing blockchain technology to enable trading and transfer of “coins” by investors.
These past few months have definitely been remarkable for cryptocurrency.
Towards the end of November, Bitcoin plunged more than 30%, placing it at new 13-month lows. And although recently, crypto has been crashing a bit , it still stands as a pseudo-currency that most investors are optimistic about. Then again, when surfing the market for cryptocurrencies, Bitcoin isn’t the only available choice. Matter of fact, there are about 180 cryptocurrencies available on the market and Litecoin happens to be among the biggest “altcoins” available.
Now, what is Litecoin?, and how can it be bought?
What Is Litecoin?
Litecoin is the third largest-cryptocurrency on the online market after Bitcoin and Ripple. It carries out its transactions on numerous digital wallets and exchanges, and has more circulating supply of coins than Bitcoin. Litecoin was set up in 2011 by Charles Lee and has a coin limit of 84 million.
Same as other cryptocurrencies, Litecoin operates as a payment structure parallel to fintech companies such as PayPal (PYPL), meaning it allows users trade with or make payments with the currency.
LUnder MIT/X11 lісеnѕеѕ, The former Google (GOOG) engineer created Litecoin, establishing the coin off of Bitcoin’s original code gaining for Litecoin the title of “altcoin” (alternative coin to Bitcoin).
Litecoin reached a peak price of $360.93 in December 2017 ,since its arrival on the market in 2011, moving up an astounding 8200% from its previous price of $4.40 the year before, according to Forbes. And as a result of its likeness to the original Bitcoin, Litecoin is usually called the “silver” to Bitcoin’s “gold.”
When searching for cryptocurrencies to trade or own, there is definitely a vast array of choices. So what makes Litecoin stand out?
Algorithm and Mining
Litecoin utilizes a proof-of-work algorithm called Scrypt, similar to the one Bitcoin uses. This algorithm makes coins at four times over Bitcoin’s algorithm’s speed, regardless of the fact that it was designed after the primary bitcoin. Litecoin’s algorithm possesses a transaction processing speed rate of one coin every 2.5 minutes.
Litecoin’s algorithm utilizes computing abilities to engage in transactions, which are completed by “miners “validating transactions with their computing capacity. This leads to the miners receiving coins in exchange. Also, Litecoin’s Scrypt Algorithm is usually considered to be very capable considering that it avoids extra customization with hardware solutions such as Application-Specific Integrated Circuits (ASICs), and supports high-speed random access memory. This is why Litecoin’s Scrypt Algorithm is usually regarded as simpler for regular cryptousers to use in easy mining because it enables miners use CPUs (central processing units) or GPUs (graphics processing units).
Litecoin’s market cap rests at around $1.75 billion as of 2018. It’s circulation is currently 59.61 million.
Litecoin is priced at around $28 as of December, 2018.
Same as other cryptocurrencies, Litecoin has a coin mine limit. Litecoin can dole up to 84 million coins – above bitcoin.
Although, Litecoin (same as other cryptocurrencies) can be broken down or bought in lesser amounts, so the significance of total coins has sort of reduced.
Anytime cryptocurrency miners mine a block of any certain currency, they are rewarded with a particular amount of coins. Miners are rewarded with current rewards of 50 LTC (2014).
But, Litecoin’s rewards are cut in half every 840,000 blocks but as a result of Litecoin’s average processing speed of almost 2.5 minutes per LTC, it takes years for the rewards to be cut in half.
Litecoin Exchanges and Wallets
If you’re in the market to purchase, trade or sell Litecoin, a platform is absolutely necessary. So where can you trade or purchase it?
Cryptocurrency exchanges are areas to sell and purchase crypto. But do your research before using any wallet or exchange to prevent being hacked or scammed. It is better to be safe than sorry.
A considerable number of exchanges exist that give Litecoin as well as other cryptocurrencies such as Bitcoin.
One of the wider exchanges that Litecoin has is called Coinbase – which proffers an array of other cryptocurrencies in the event one isn’t sufficient. Also, Gemini -the Cameron and Tyler Winklevoss-owned exchange- offers Litecoin ;which can be purchased with USA. As an addition, Litecoin can also be purchased with BTC (Bitcoin) or ETH (Etherneum’s coin). Litecoin’s creator celebrated the plus on Twitter (TWTR – Get Report) .
Since MtGox released the news that Litecoin support was coming in 2013 and then failed to make good the promise, I’ve been on a quest to improve liquidity by getting LTC added to exchanges.
With the release of LTC on Gemini today, every top Bitcoin exchange is backing Litecoin. Quest completed!
Litecoin can also be traded, bought or sold on Binance or Bitfinex- both considerably vast and largely used cryptocurrency exchanges.
Once you’ve chosen the exchange to operate on, a wallet to save your LTC is the next requirement, so what are your choices?
Cryptocurrency wallets have a number of uses and types -, including desktop, mobile, paper, hardware and software. You may have the wish to save your cryptocoins in a wallet that is easily reachable or you may wish to store it in an offline storage space that is safe.
Hardware wallets such as Tew or provide a reliable offline place safe from hackers. Trezor supports Litecoin, among the other 500 cryptocurrencies.
Nonetheless, if you need a simple online reach to your coins, Exodus or Jaxx are the wallets for you. Jaxx provides both mobile and desktop interfaces that enable easy reach to your coins. Also, Exodus as well as being a wallet, also offers as part of its services – exchange
But what makes Litecoin the best choice over other cryptocurrencies? Or at the minimum – what differentiates Litecoin from other cryptocurrencies?
Litecoin vs. Bitcoin
Bitcoin is popularly known for paving the way since 2009 for other cryptocurrencies, when it was set up by an anonymous individual who went by the alias – Satoshi Nakamoto. Bitcoin retains its position( unlike Litecoin) as the most well known cryptocurrency with a value of over $3,519 (although it crashed recently from around $6,000).
Other than their value, there are however numerous major differences between Litecoin and Bitcoin.
Both cryptocurrencies utilize separate algorithms and separate mining requirements as well. Litecoin operates a simpler algorithm known as Scrypt while Bitcoin operates traditional SHA-256 algorithm (which is a cryptographic proof-of-work algorithm very similar to Litecoin’s). But, Bitcoin’s algorithm is largely regarded as more complicated. It also stresses processing capacity – utilising what is known as Application-Specific Integrated Circuits (ASICs) – which are hardware structures that can be tailored for mining a particular cryptocurrency such as Bitcoin. Yet, as a result of Bitcoin’s algorithm needing more processing capacity, it is regarded as less user friendly and more complex than Litecoin’s.
Also, Litecoin’s transaction processing speed is much quicker than bitcoin – it runs at 2.5 minutes as against Bitcoin’s 10 or so minutes.
While Bitcoin’s market cap crashed recently below $100 billion for the first time in one year, it still rests quite above Litecoin’s at almost $98 billion. Also, bitcoin has way less total coins (21 million) as against Litecoin’s 84 millions, the coin has been exchanged in so little amount (divided into 0.00000001 Bitcoins, termed “satoshi” in the crypto community) that the sum total is a bit less significant. And while Bitcoin’s rewards (at 25 BTC per block), just like Litecoin, are cut in half, they are cut in half every 210,000 blocks.
Litecoin vs. Ethereum
Ethereum differs from Litecoin in the sense that Ethereum is both a cryptocurrency and a blockchain – with Ether as the coin itself (though for investors usually regard its as synonymous with Ethereum).
While Litecoin is a cryptocurrency, Ethereum is a digital blockchain platform that builds and operates decentralised applications known as “dapps”. Due to this reason, Ethereum acts in a like manner as the Internet but saves data in separate blockchain ledgers rather than a general storage area like Facebook or Google (FB – Get Report) .
Yet, – Ether(the coin) – gives out just 3 coins in rewards for mining one block (as against Litecoin’s 50).
How to Invest in Litecoin
Basically, the simple way is through exchanges.
A lot of investors purchase Litecoin with either BTC (Bitcoin) or USA. The reason for this is that different exchange have different purchasing or trading capacities, ensure that you find out if your exchange supports USD or BTC to LTC transactions
The optimal option generally is to use a larger exchange such as Coinbase ( for making use of credit or debit card with USD) or Binance ( where you can exchange BTC for LTC).
Nonetheless, due to cryptocurrency’s lack of a regulated pseudo industry, it should not be regarded as an equal type of investment venture as bonds, stocks or other financial securities. It is highly advisable to proceed carefully when investing (especially considering the instability of cryptocurrency these past months)
Cryptocurrency is known for short-selling and looking at the fall in Bitcoin price, most people are rooting for short-selling as the route to follow as regards cryptocurrency.
The Federal Reserve Bank of San Francisco wrote this summer – “The new investment opportunity led to a fall in demand in the spot bitcoin market and therefore a drop in price. With falling prices, pessimists started to make money on their bets, fueling further short-selling and further downward pressure on prices”. Others on the fintech platform are optimistic with the cryptocurrency strategy.
Simon Taylor, cofounder of fintech consultancy 11:FS, told Forbes this summer – Shorting is one part of the creeping legitimization of bitcoin-we’re getting access to proper financial products,”
What Is Cryptocurrency?
Similar to traditional currencies, Cryptocurrency is a new age asset that can be utilized for transactions. It uses cryptography to ensure the safety and validity of the online currency (hence the “crypto”). To this length, Cryptocurrency mostly utilizes decentralised blockchain technology to enable people who build new blocks on the blockchain (they are known as miners) to mine several amounts of varying crypto coins as they build new blocks.
But, Cryptocurrency is still mainly unregulated, and unaccepted as currency ( matter of fact, the number of vendors that accept crypto coins are relatively small). Companies that do accept cryptocurrency include Expedia (EXPE – Get Report) and Dish Network (DISH – Get Report) .