When bitcoin first came onto the scene, many thought it would be short-lived. However, the market is now filled with various cryptocurrency options, with bitcoin being just one of them. One of the alternatives to the popular founding cryptocurrency is Litecoin. So, should you buy Litecoin?
Despite the supremacy of BTC, the alternatives, such as Litecoin, are gaining popularity for various reasons. For example, Litecoin is much more affordable than bitcoin, which means it is easier to buy. And, if you’re crypto gambling at the best crypto casino, taking a loss won’t be as tough on the pocket.
In addition, many of the newer alternatives were developed in response to issues found within BTC, meaning that they don’t have these issues themselves. With this information alone, you may jump at the opportunity to buy Litecoin. But don’t do it just yet. First, read on to learn more about cryptocurrency to be sure you want to go for it.
LTC Currency Overview
Before considering whether you should buy Litecoin, let’s dive into what it is. The cryptocurrency was one of the first to enter the market after bitcoin, with its initial launch in 2011, just two years after BTC came into existence. Since then, it has become tremendously well-known and sought after and can be found on every crypto exchange.
Like almost all other currencies, LTC uses blockchain technology to run on, ensuring that it is decentralised.
A Short History Of Litecoin
As we mentioned, Litecoin came into existence in 2011, in October of that year, to be specific. It began when Charlie Lee, a former employee of Google and follower of Bitcoin, published the newer cryptocurrency’s whitepaper.
Essentially, Lee thought that BTC was valuable. However, he thought it would be better if improvements were made in various aspects. His improvements to the cryptocurrency centred around the time transactions take (he wanted the times to be reduced), fees, and the mitigation of mining pools.
After two years in the market, Litecoin achieved a $1 billion market capitalisation. Today, it is still one of the strongest crypto options.
How Does The Currency Work? Litecoin Compared To Bitcoin
Since the currency is based on bettering BTC, it functions similarly to its predecessor. However, there are a few modifications in the areas where Lee thought it was necessary. Understanding these differences may help you decide whether you want to buy Litecoin.
Here are three of the main differences:
- Transaction Speed
One of the reasons behind the popularity of Litecoin is the increased transaction speed (in comparison to BTC). On average, a transaction on the BTC network takes around 9 minutes to be confirmed by miners. On the Litecoin network, however, the same task takes around 2.5 minutes to complete.
2. Mining
The difference is actually in the algorithms used to mine the two cryptocurrencies. Bitcoin uses SHA-256, and Litecoin uses Scrypt. The former is much more complicated than the latter, and thus BTC is more difficult to mine.
In practice, this has led many miners to use increasingly sophisticated methods of mining BTC. It has also made BTC mining inaccessible to individual miners, who must join a mining pool if they hope to mine the crypto successfully.
Mining LTC is still very much accessible to the everyday miner. It means getting your hands on it easier if you’re a miner. This is not the case with Litecoin and Scrypt.
3. Total Coins
As we all know, the maximum BTC that can exist is 21 million. LTC, on the other hand, maxes out at 84 million.
This sounds like an advantage to the latter. However, it is mostly psychological. Because there are more coins to be mined, it seems like there is more to go around, so more people can buy and use it. However, it just brings down the value as more gets created. This is based on the basic supply and demand principle.
On top of all this, a low price doesn’t mean much since you don’t have to buy one whole bitcoin. So, you could spend the amount you would have to buy one Litecoin to purchase a fraction of a BTC.
Is It A Good Investment To Buy Litecoin?
Now that you know LTCs’ differences from the most popular cryptocurrency, Bitcoin, and you probably already have a bit of a grasp on which one you prefer, we can dig into investing in Litecoin.
Well-known investors are supporting cryptocurrency, insisting that it should be considered a strong player in the crypto market and that its price has the potential to grow much more in the long term. LTC is currently one of the largest cryptos concerning market cap. Based on this alone, many believe this cryptocurrency is worth investing in this year.
As of writing (Jan 2021), Litecoin is priced at $141.11 with a 24-hour trading volume of $14,689,580,045. Of course, this can’t compare to the ever-powerful BTC, but it does show the currency’s potential when we look at the change in price since last year. The currency is down 18.41% in the last 24 hours.
In December 2020, the currency was trading at $84.57 with a 24-hour trading volume of $3,413,410,775. At that time, the currency was experiencing an increase of more than 70% from Black Thursday in the same year. Keep in mind that these increases occurred amid a pandemic raging throughout the globe. These figures are quite convincing when you decide to buy Litecoin.
LTC Price Prediction
A key consideration in buying Litecoin is the year’s price prediction and beyond. This will give you a good idea of whether cryptocurrency is a good investment. It could indicate whether the currency will increase in value, giving you a profit, or decrease in value, giving you a loss.
Experts predict a bullish trend in this cryptocurrency, with the currency expected to reach new highs in the upcoming months or years.
Here are a few of the predictions:
- LongForecast, a group that uses mathematics and statistics to predict performance, believes that the currency will be between a high of $140 and a low of $90 in 2021.
- TradingBeasts, who make predictions using historical data and linear and polynomial regressions, expect the currency to start strong in February 2021, with a max price of $179.78 and a min of $122.25. At the end of 2021, they predict that the cryptocurrency price will be around an average of $165.17. Their predictions remain relatively positive until 2024 (when their predictions stop). At the end of 2024, they expect the price to be an average of $307.65.
- Digital Coin Price, which uses historical analysis, expects the currency to peak at around $135 at the end of 2021 and increase in 2022.
While none of these is as strong as BTC, and maybe even some other cryptocurrencies, the outlook is still generally positive and indicates that it might be a good idea to buy Litecoin.
Pros and Cons Of Buying Litecoin
Here are some pros and cons of investing in this cryptocurrency to make it easier to decide if you want to buy Litecoin.
The Pros
There are multiple advantages that you can leverage when you buy Litecoin. The currency is easy to trade, reliable, has an efficient mining algorithm, and has relatively low transaction fees.
If that wasn’t enough, the currency is always improving, meaning there will likely be additional benefits in the years to come.
The Cons
While there are fewer disadvantages than advantages, the negatives are still there. LTC’s downfalls are its uniqueness declining, it does not have as much credibility as some other cryptocurrencies, and it is relatively popular on the dark web (which has tarnished its reputation a bit).
Final Thoughts
Of course, it is impossible to give a firm yes or no answer to whether you should buy Litecoin. However, based on the outlook for the future of the currency, the comparison to bitcoin, and the pros and cons of buying Litecoin, you should have a better idea of whether or not you want to invest.
It’s worth keeping in mind that predictions can easily change, and there could be significant price hikes since crypto is still in its developmental years. You should always do in-depth research before you buy Litecoin or any other cryptocurrency.
