Litecoin is one of the alternative digital currencies founded following the global success of Bitcoin. Years on, Bitcoin is touted as digital gold, while Litecoin, also known for its abbreviated form LTC, is referred to as digital silver.
Founded by Charlie Lee, a former Google engineer, Litecoin was launched in 2013 following a few improvements over other cryptocurrencies, and is said to have been created as a faster and better alternative to Bitcoin in terms of technology. Since then, it has enjoyed popularity among investors, staying in the top ten performing cryptocurrencies from its inception until 2020.
This guide discusses the basics of Litecoin and sheds light on some important questions investors and crypto newbies are raring to ask.
What Is Litecoin?
Litecoin is one of the alternative cryptocurrencies or altcoins, working through a peer-to-peer cryptocurrency network and open-source project that’s based on the technology responsible for the creation of Bitcoin. That being said, LTC is said to improve upon the processes of the cryptocurrency giant, which makes it safer from hackers, and leading to lower transaction costs.
As a digital currency, Litecoin relies on decentralized principles, which make it accessible to crypto investors around the world.
Why You Should Invest In Litecoin
As one of the older altcoins in the market, LTC is potentially one of the more stable altcoins in the volatile cryptocurrency market. Generally, it has better value than other altcoins. Being a Litecoin investor lets you enjoy the following benefits:
- Faster transaction. On average, Litecoin transactions last for 2.5 minutes, while Bitcoin transactions typically take 10 minutes to finish. The faster transactions offered by LTC also translate into lower transaction fees when you buy and sell Litecoin Canada, for instance.
- Lower fees vs. other cryptocurrencies. Despite having the better technology compared to its predecessor, Litecoin still offers lower transactions costs compared to other digital currencies.
- More secure. Cybercriminals attempt to highjack cryptocurrencies during transactions. Because Litecoin processes are more secure and take faster to complete, they’re also less susceptible to anomalous transactions, such as double-spending.
- One of the top-performing altcoins. Despite being one of the oldest cryptocurrencies present in the market, LTC remains as one of the top-performing alternative digital currencies.
- Stable. As with other cryptocurrencies, investing in Litecoin comes with risks, being that the crypto market is volatile, in general. However, Litecoin’s limited supply of 84 million may make it more resilient against inflation and depreciation.
- Flexible platform. LTC was developed to expand on the system used by Bitcoin. And, being an open-source platform makes it easier for developers to continuously tweak the system for updates that benefit the investors and meet the needs of the ever-evolving crypto market.
Is Investing In Litecoin Risky?
As with all cryptocurrencies, Litecoin investment does have risks attached to it. Perhaps, the biggest dent to impact investor confidence in LTC occurred in 2017, when Litecoin founder himself, Charles Lee, sold all of his stake. Citing conflict of interest as the main reason for his move, Litecoin’s long-term stability was still put into question.
Additionally, other altcoins have been offering the same benefits as faster and safer transactions, which no longer make Litecoin unique.
Overall, the interest over Litecoin has increased in the past few years. In 2018, a blockchain-capable phone powered by Litecoin was announced. Japanese multinational company Atari partnered with LTC in 2020 for its blockchain technology. In an attempt to penetrate the traditional banking system, the Litecoin Foundation obtained 9.9% of Germany-based WEG Bank AG in 2018.
As of January 2021, there are over 65 million LTCs in the crypto market.
How To Invest In Litecoin
As with any type of digital currency, you need to open an account on a crypto exchange and deposit or buy LTC. You can then transfer Litecoins to a crypto wallet and trade them in various platforms. Otherwise, you may also purchase an LTC cloud mining contract from a reliable cloud mining service.
A cryptocurrency broker may offer you access to trading platforms where you can buy and sell cryptocurrencies. A crypto broker will execute orders on your behalf.
Many believe that Litecoin will appreciate in value in the years to come. But, with the highly unpredictable crypto market behavior, take this fact with a grain of salt. Before investing, do your homework and don’t invest in amounts more than you can afford to lose.