This year Bitcoin will enjoy the light of the spotlight, but there are many alternative cryptocurrencies on which it is worth investing, which go by the name of altcoin, ie alternative coins. In this article we will talk about Litecoin.
What is Litecoin and what’s more than Bitcoin?
Here is the description published on the Litecoin website:
“Litecoin is a peer-to-peer digital currency that allows instant payments at almost zero cost to a recipient, wherever it is. Litecoin is a global, open source, fully decentralized payments network without central authority. Mathematics guarantees the network itself by transferring sovereignty over the control of its finances to individuals. With respect to Bitcoin, Litecoin has a greater frequency in confirming transactions and better efficiency in data retention. With broad support, high liquidity and large volumes, Litecoin is a consolidated means of exchange that is complementary to Bitcoin. ”
First of all, Litecoin has lower fees than Bitcoin. It’s a few cents, compared to the current $ 20-40 $ per Bitcoin transaction. In addition, Litecoin’s confirmation times are 4 to 8 times faster than Bitcoin’s. Not to mention that the times of Bitcoin are further slowed during the moments of higher or lower. Finally, there are possible advantages in the algorithm used by Litecoin in comparison to the SHA-256 algorithm used by Bitcoin: the Litecoin algorithm, among the various advantages, should prevent the formation of large mining pools which then, as now happens for Bitcoin, they actually end up holding the cryptocurrency hostage. We will not go into technical details, but very simply, the algorithm that runs Litecoin is simpler but faster, which requires less energy expenditure.
Ltecoin, Bitcoin and speculation.
Although Litecoin presents the obvious advantages just listed, Bitcoin will not lose any of its records. We can think of Bitcoin and Litecoin as gold and silver: silver can not replace gold, but certainly we can also speculate on silver. Can we compare Litecoin to silver? Litecoin has been noted in recent months. Let’s see its main strengths.
Litecoin was created in 2011 by Charlie Lee, a former Google employee who joined Coinbase in 2013. Charlie Lee is an authoritative and famous figure that makes Litecoin less ambiguous and mysterious than Bitcoin, therefore more attractive in the investment world. More traditional and cautious investors may be more motivated to invest in a more centralized cryptocurrency if this were created in an environment more suited to the needs of those seeking not only to increase, but also to safeguard their capital.
Litecoin also has a very significant market cap. For some time now firmly present in the top 10 of cryptocurrencies for market cap, today (24 January 2017) is in 6th place.
With its current positioning, Litecoin exceeds by capitalization some important cryptocurrencies, including Dash, Monero, Bitcoin Gold and Ethereum Classic.
Recall also that each unit of Litecoin (LTC) costs less than a Bitcoin. Investors like the idea of buying whole coins. You need over $ 10,000 to buy a whole Bitcoin, while you need $ 180 to buy a Litecoin. Although it may seem trivial, human history and psychology tell us that people tend to think it is better to have 10 LTC than 1 BTC. There is the appearance of a wider opportunity. Here we are talking about speculation, therefore of short-term gains, and Litecoin certainly comes out from this point of view.
Another point to consider is what we call “the Coinbase effect”. Coinbase allows you to buy BTC easily, but lately there is more and more free marketing for Litecoin every time you access Coinbase. This figure is important because Coinbase now has more than 10 million users, which makes its influence in the world of cryptocurrencies enormous. Recall that Coinbase currently only deals with 4 cryptocurrencies: Bitcoin, Bitcoin Cash, Ethereum and Litecoin. The fact that LTC is among the “chosen” may depend on the fact that Lee worked for Coinbase.
To recap …
In this article we have seen seven main advantages of Litecoin:
- Litecoin has lower Bitcoin fees
- The confirmation times of Litecoin are significantly faster
- Litecoin enjoys Charlie Lee’s leadership
- Litecoin has a significant market cap
- 1 LTC costs much less than 1 BTC
- Advertising on Coinbase
- Litecoin is a good opportunity for diversification
With a more technical in depth we could certainly find other advantages of Litecoin, but the points touched on in this article should already convince us that Litecoin is a valid alternative to other cryptocurrencies, Bitcoin in the first place. Suffice it to say that BTC has risen 1,300% in one year while LTC has risen 2,400%. In other words, if you had invested in LTC early last year, you would have earned more than you would have earned by investing in BTC. As long as cryptocurrencies exist, speculating on Litecoin makes as much sense as speculating on Bitcoin.