Litecoin is a blockchain-based peer-to-peer means of exchange of value, goods and services that is fully decentralized and is not issued by any government, or central bank in the world.What is Litecoin
A Litecoin wallet is basically equivalent of a bank account. It allows you to receive and store Litecoins to send them to others. Litecoin wallet is a software where Litecoins are stored.Litecoin Wallet
Regular currencies are printed to increase the amount of cash in circulation. Cryptocurrency such as Litecoin is generated by machines that solve complex algorithms.Litecoin Mining
The cryptocurrency industry has had a magnificent 2017 that has seen it now fully entrenched into mainstream life and the psyche of people, shaping new ways of living and doing business. This is the year in which the whole industry reaped in huge bounties, multiplying in its value over ten times from where it began in January. Litecoin is a cryptocurrency founded by Google alum Charlie Lee.
Its market capitalization is about $3.28 billion, which makes it the fifth largest cryptocurrency. Like its competitor the bitcoin, litecoin makes use of blockchain technology. Transactions are done in blocks and recorded in a public ledger. Litecoin is a trustworthy and well-known coin. It’s cheaper and much faster to send than bitcoin.
Bitcoin is the pioneer in this brave new world and has consistently been responsible for over half the total value of the industry. Its mini cousin, Litecoin will take that crown as it has been the one that has been able to grow over 8000% within this year alone! That’s 80 times the value it began with from January. So what is litecoin all about? How to invest in litecoin? What affects litecoin price? What makes litecoin different from Bitcoin and what determines its value? This and more we intend to cover in this piece.
Litecoin is a blockchain-based peer-to-peer means of exchange of value, goods and services that is fully decentralized and is not issued by any government, or central bank in the world. Litecoin is a virtual currency that is stateless and borderless, offering a private, fast, cheap, and highly efficient means of sending payments between peers directly without ever needing to resort to the use of any middleman, banking institution or payment provider.
Litecoin was the creation of one-time Google Engineer by the name Charlie Lee, whose identity is known, unlike Bitcoin’s Satoshi Nakamoto. Lee created Litecoin and set it out online in October 2011. His brainchild has been conceptualized with a lot of the problems that began facing Bitcoin users at the time, which Litecoin came to change. But the founder himself says he only hopes to use Litecoin as a complementing currency to Bitcoin, not as one that seeks to replace it. It was to become the Silver to Bitcoin which is still considered the Gold among all cryptocurrencies.
There are brokerages and exchanges set up for investing in litecoin. You can make use of bank transfer or a debit card to purchase litecoins. You can also buy bitcoins and exchange them for litecoins. But because bitcoins are more expensive, you may not be able to afford this method unless you buy a fraction of bitcoin.
You can buy litecoins and keep them with the exchange, hoping the price continues to rise. Once you reach your target, you can sell your litecoins for British pounds or U.S Dollars, much as you would trade a stock.
You can also download a digital Litecoin wallet to your mobile device or computer and move your litecoins from the exchange to your wallet. This process is good if you expect to pay for goods and services with litecoins, or if you would like to keep your cryptocurrency coins safe until you’re ready to sell them at a profit.
Litecoin despite its cozying up to Bitcoin and saying it’s not on the market to out-do or replace it, is a completely separate entity with its own identity and a set purpose in the mind of those who created it. Despite the fact that Litecoin was more or less built on the same source code on which Bitcoin was built, it has almost nothing in common with its big brother except the fact that, they are all both peer-to-peer digital currencies. Some of the features that Litecoin has which makes it different from Bitcoin include:
Bitcoin, when it was the sole participant in the cryptocurrency market in 2009, was hailed as the fastest means of sending money from one part of the world to another, ever known to man. But this was not to be for long, as with the adoption of Bitcoin by more users, it was clear that it has a design flaw in that its maker did not create it in such a way to accommodate a huge number of users all trying to transact at the same time.
This made Bitcoin very slow and cumbersome to deal with especially for businesses. Litecoin saw this problem and Charlie Lee created it in a way which makes it four times faster in conducting transaction than what Bitcoin is. A new block takes only 2 and half minutes to create with Litecoin compared to the over 10 minutes it takes to mint a fresh one with Bitcoin.
Another area where Litecoin did its best to stand apart from Bitcoin is the total amount of coins that would be ever created on its blockchain. While Bitcoin made a major point where it saw the value of having a scarce commodity which is bound make its value rise with greater demand, Litecoin saw both the promise and potential dangers to Bitcoin’s approach and made adjustments that would suit it better.
There will be only 21 million Bitcoins to be ever mined on its blockchain, and the mining process gets ever harder with the passage of time, requiring further expensive hardware to make it profitable. Litecoin on the other hand wanted a more expansive coin distribution that will not make getting it impossible but still maintain a measure of control, and as such it was designed that 84 million Litecoins will be maximum to be ever mined on its network.
Again when it comes to the amount which a user needs to spend to have their transactions processed, Litecoin took a completely different path from Bitcoin, whose process has long been a target of criticism. On the Bitcoin blockchain, the participating computers that work in processing and verifying its payments are given a choice to set their fees for their services.
This has led to a constant rise in these fees, as the miners try to cover up for the high electricity bills and expensive specialized equipment they have to buy to remain competitive. Litecoin did away with all of that as it maintains a very minute fee on its transactions as close to zero as possible, which makes it the ideal currency for sending such kinds of small payments
Bitcoins mining protocol is known as the SHA 256 proof of work protocol. In simple terms, this means that to mine the cryptocurrency, a huge amount of processing power is needed. The Bitcoin blockchain is bigger in the amount of computational power than thousands of the most powerful supercomputers combined. This gives it a good security from sabotage, but it also makes it inordinately expensive to carry out the mining process.
The expenses in mining a single Bitcoin as of the present is in the thousands of dollars which have meant it was no longer possible for small and individual miners to participate equally. Litecoin saw that as what will eventually cause a centralization of Bitcoin and made sure it took a different protocol known as the Scrypt Proof of Work Protocol instead. This ensures that mining of Litecoin was resistant to the “arms race” that ensued with Bitcoin meaning that anyone could participate and gain from mining it.
The price of Litecoin like every other crypto asset on offer can be very unpredictable even for most seasoned experts in the industry. Looking at Litecoin’s price charts, it’s difficult to detect a pattern that might enable one to predict future behavior accurately. However, there are a few known factors that do affect the cryptocurrency some of which include:
Litecoin from the very beginning has rather aligned itself with Bitcoin instead of taking a completely rebellious stand against its bigger brother. Litecoin keeps attributing to itself (maybe due to their similar structure), also affects it almost every time there is a major shift in the price of Bitcoin. It’s a very much expected happening that once Bitcoin price moves down, for whatever reason that might be, Litecoin also moves in the similar direction. This is one of the reasons some experts see it as not totally independent from the bigger crypto asset, which might be its biggest character flaw.
Another factor that constantly affects Litecoin is the movement of money in and out of its ecosystem. Looking at Litecoin’s Price charts and transaction volumes over the years, one could easily see that whenever there is a sudden move of big money into the cryptocurrency, there is a corresponding sudden jerk in its prices. And when money seems to be leaving it in large volumes, its prices also tumble.
The public’s opinion is one big factor concerning what determines Litecoin price. Presently, the innovation has got mixed reaction from many people across the globe. Some people have lauded Litecoin for being silver to Bitcoin’s gold even though others gave undesirable reaction as it can be linked with criminality.
Like every other cryptocurrency, Litecoin is not on the best of terms with the banking establishments around the world and the governments of most countries who view the industry as evil. The Litecoin community is always on the lookout for any news of clampdown on the industry or news of some of its biggest markets (such as South Korea) making plans to regulate the industry. However, this reaction in prices tends to be short-term as traders usually go back to their routine as the news grows cold.
Though Litecoin is already used in some electronic transactions, there is still some debate about its capacity to perform transactions quickly and cheaply, which caused some investors to avoid the protocol asset. A secure blockchain technology makes the mining activity more challenging.
Litecoin has truly carved itself a place on the high table of cryptocurrency. It’s among the top 5 most valuable digital currencies in the world, and as of the time of writing this, it is valued at over $16 billion in the total market cap. This year has been quite a revelation for Litecoin as it has come to surpass any expectation the world used to have of it. It began the year trading at barely $4 and has gone on to trade for as much as $400 at its peak at certain times this year. And as we round up the year, speculation is rife about what the coming year and the time beyond that have for this altcoin.
While it’s complicated to pinpoint the exact place where Litecoin might be in the time ahead, it is essential to look at its present state which will be a good indicator for any future performances. The cryptocurrency industry is truly here and will remain with us no matter what its naysayers might say. Bitcoin began something truly spectacular that has gone on to create an industry worth hundreds of billions of dollars.
The sheer value of the market is not its only guaranty for survival as it offers efficient uses for people who want a hassle-free means of conducting their transactions. Bitcoin has drifted off from its core ideal of being the go-to day to day means of making payments to a more store of value kind of cryptocurrency, and this presents Litecoin with its biggest opportunity yet for growth and capturing the everyday transactions niche.
We might not be able to finger directly the price Litecoin will be in the coming year and the time beyond that, but it’s perfectly understandable that if 2017 is anything to go by, Litecoin is up for further astounding growth in value as it gains more acceptance and coverage with Bitcoin’s withdrawal from the micropayments niche.
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