While Bitcoin is dealing with some serious scalability issues due to its high transaction fees, Litecoin, in theory, is able to churn out block after block and retain its lower transaction costs. Before you invest in Litecoin, learn how to buy Litecoin and read up on cryptocurrency wallets and how to buy in crypto in Canada. Speak with a financial planner about how much you could realistically invest in cryptocurrency based on your unique financial goals. For supporters, the Litecoin network’s most obvious advantage may be its relative speed. Overall, Litecoin is conceptually similar to Bitcoin, but with minor differences.
How to trade Litecoin CFDs
In 2024, Litecoin activated Runes (similar to non-fungible tokens), similar to the Runes available on the Bitcoin blockchain. Bitcoin whales are major market players who can influence the price of bitcoin when they decide to buy or Asian stock futures sell large volumes of the digital currency. However, its core tech is arguably outdated, and many cryptocurrency investors view Litecoin as a cryptocurrency without a clear use case.
Litecoin is a cryptocurrency created from a fork of the market making for crypto projects Bitcoin blockchain but with several changes. It is faster, will have more coins available, and uses a different hashing algorithm than Bitcoin. Litecoin transactions are typically confirmed in just minutes, and transaction fees are nearly negligible. This makes it an attractive alternative to Bitcoin in developing countries, where transaction fees may be the deciding factor on which cryptocurrency to support.
The value in most cryptocurrencies is derived from their potential; how they could be used to advance society in the future. Without institutional acceptance however, the potential value, will remain merely potential, but whether this implies that cryptocurrencies are overvalued is another question. Sign up at Capital.com to use our desktop platform, or download our mobile app to start trading on the most popular global markets anywhere, anytime.
The Silver to Bitcoin’s Gold
Litecoin was conceived as a complementing, rather than competing, cryptocurrency to Bitcoin. Litecoin transactions require a fee that’s typically lower than that paid for Bitcoin transactions. This lower fee structure is a result of the less congested network and the efficiency of the Scrypt algorithm. Lower fees combined with faster transaction times make Litecoin an attractive option for micro-transactions and regular day-to-day online purchases. These are just a few of the things you might hear getting tossed around when crypto enthusiasts talk about Litecoin. At first glance, Litecoin doesn’t garner much respect as a top 10 market cap cryptocurrency.
- “It was engineered to be used for fast, secure and low-cost payments.” Think of it as a Bitcoin spinoff.
- The cost of sending any denomination of LTC costs around $0.02, whereas Bitcoin currently hovers around $0.35.
- Litecoin transactions require a fee that’s typically lower than that paid for Bitcoin transactions.
More In Crypto World
This is a high-risk investment and you are unlikely to be protected if something goes wrong. Our team is diligently working to keep up with trends in the crypto markets. The regulatory landscape for cryptocurrencies is evolving, and how it develops will undoubtedly impact Litecoin.
How does Litecoin compare to Bitcoin and other altcoins?
While Litecoin is a Bitcoin fork, there are many differences besides market capitalization and price. You can sell your Litecoin on the same exchanges where you can purchase it. However, selling your crypto on a centralized exchange is different than selling it on a decentralized one. For the top 21 stocks to buy in 2021 2020 example, if you’re selling your Litecoin on an exchange like Kraken, you’ll need to send your LTC to your Kraken address. Don’t invest unless you’re prepared to lose all the money you invest. Bitcoin is a high-risk investment and you are unlikely to be protected if something goes wrong.
While Bitcoin is capped at a maximum supply of 21 million coins, Litecoin is capped at 84 million coins. Scrypt and Litecoin’s PoW require significantly more processing power than SHA-256 and Bitcoin’s PoW. However, Litecoin produces tokens at four times the rate Bitcoin does and has a smaller network, so it uses less energy to produce a block reward (at least in May 2024).
A financial advisor can help you decide if it is right for your portfolio. At the beginning of the 2010s, as mining operations developed specialized hardware—like the application-specific circuit (ASIC) to solve SHA-256 hashing—it appeared that Bitcoin was vulnerable to such an attack. By making Litecoin’s consensus algorithm memory intensive, Lee sought to thwart the hardware arms race, though in practice, that didn’t happen as ASIC designers found a way to make Scrypt miners. Lee used Scrypt to make large-scale, custom-built hardware attacks on the currency more difficult. Bitcoin’s SHA-256 algorithm does not require a lot of random access memory (RAM) as an impediment to parallel processing, whereas Scrypt does. You can participate in the Litecoin network by downloading a client and becoming a miner, or you can buy and sell it on exchanges.
Litecoin’s primary goal was to create a version of Bitcoin that is more scalable and aimed at small payments. While it does achieve this goal to a certain extent, newer blockchain innovations such as Stellar Lumens do a much better job than Litecoin. In 2022, Litecoin is officially a dinosaur coin, and presents especially high risk for a top 25 crypto project.
