What You Need To Know About Litecoin (LTC) Before The Next Financial Crisis
Some call it the “Silver to Bitcoin’s Gold”; others call it the “Dark Horse of 2018”. Whatever name cryptocurrency investors give Litecoin, one thing is sure – Litecoin is going to be a beast!
The launch of Bitcoin, which was the pioneer of cryptocurrencies, gave software developers the chance to fork its original codebase, creating even better coins with improved features. Charlie Lee, the founder of Litecoin, saw this as a significant opportunity to disrupt the cryptocurrency world and come up with the mighty Litecoin.
The problems that Bitcoin experienced since its inception appeared to be solved. See, Litecoin addressed the issue of transaction time, processing transactions at the speed of 2.5 minutes per block, which is four times faster than that of its older sibling – Bitcoin.
But this isn’t the only reason why Litecoin is likely to be a giant, possibly overtaking other cryptocurrencies in terms of value and market capitalization to become one of the top (if not the top) cryptocurrencies. Let’s explore this digital currency, looking at what exactly it is, the technology behind it, and, of course, why it is among the best coins for investors.
The Story Behind Litecoin
The idea of Litecoin started in 2011. Charlie Lee, a software engineer, working at Google, came across a piece about Silk Road, the dark web marketplace, on the internet. The article explained about the inception of Bitcoin, which was the first decentralized currency. Though it had already launched, it was in its infancy stage.
The topic was intriguing, and Lee could not help but continue to familiarize himself with the technology behind Bitcoin – blockchain. He went back to the drawing table and used the Bitcoin source code to come up with a cryptocurrency known as Fairbrix. It didn’t work because of technical difficulties.
He never gave up. In October 2011, Lee initiated development of a new cryptocurrency, which involved a hard fork of Bitcoin, the leading cryptocurrency. The digital currency went live later that month. It was called Litecoin!
To make the playing field fair, Charlie Lee ensured that only 150 Litecoins were pre-mined as a result of successive blocks, including genesis block.
Technical Aspects of Litecoin
Forking Litecoin from the source code of Bitcoin meant that it would be identical to the pioneer cryptocurrency in many ways. But many differences made it exceptional and unique. Firstly, the design of Litecoin ensures that its blockchain can generate a block after every 2.5 minutes, a
number that’s significantly lower than the generation time of Bitcoin, which is 10 minutes. Processing four blocks at the same time that Bitcoin processes one block means Litecoin’s blockchain transactions are faster.
Secondly, while the total number of Bitcoins in existence is at 21 million, that of Litecoin is set at 84 million, which is practically four times the number of Bitcoin.
Thirdly, unlike Bitcoin which uses the SHA-256 hashing algorithm, Litecoin uses Scrypt algorithm as its proof-of-work consensus mechanism. Bitcoin mining is mainly dependent on miner’s computing power, while Litecoin requires some amount of memory and computing power to verify transactions.
Litecoin Price Activity
Litecoin is among the top 5 cryptocurrencies with a market capitalization of more than $7 billion. After its inception in 2011, there was no guarantee that the cryptocurrency would make it to the top, challenging its bigger sibling – Bitcoin. Towards the end of 2013, Litecoin proved every critic wrong. It reached a milestone of a billion dollars in market capitalization, attracting even more investors to put in their cash.
While the digital currency has recorded some impressive growth, it has come a long way. On April 2013, Litecoin was going for a mere $4.30. A year later, it was going for more than $12, which is three times the original price. It didn’t stop there. Bolstered by a sharp rise in global interest in 2017, Litecoin recorded its highest price ever, hitting a milestone of $372 in December.
The beginning of 2018 didn’t come with great news, however. Just like a majority of cryptocurrencies, the price of Litecoin dropped. But this will not likely be the trend for the rest of the year. Analysts conclude that we are set to see Litecoin reach fresh highs, as Charlie Lee continues to implement the project as stated in its roadmap.
Features That Are Likely to Be Implemented by Litecoin
The Litecoin Foundation has a few initiatives lined up with the aim of increasing merchant adoption. Many Merchants have already come on board, including LitePay, GoCoin, Globee, Coin Payments, BitcoinPay, and BTCPay.
Now let’s talk about the two upcoming features that Litecoin Foundation is likely to implement and dramatically improve the efficiency of the network.
LitePay is a payment processor that’s developed by Litecoin Foundation to help ease the exchange of government-issued fit and LTC currency from across the globe. By making transactions seamless, the system is designed to be straightforward and flexible, allowing any business to introduce Litecoin payments on their site.
Many businesses tend to shy away from accepting cryptocurrency payments because of their volatile nature. There’s also no clear framework that enables transactions in a flexible, fast and convenient way. These are some of the factors that drove Litecoin developers to create LitePay, a system that allows businesses to accept their cryptocurrency and convert payments into fiat using the current market data instantly. This helps solve the issue of speed and market volatility.
The integration of this system was expected to be done within the first months of 2018 but didn’t materialize. However, adoption of the feature is likely to be implemented in 2018, a move that will see the digital currency rise in value significantly.
2. Lightning Network
Just as the name suggests, Lightning Network is a technology upgrade that allows transactions to process at high speeds. Although the technology is more linked to Bitcoin and Litecoin transactions, it is not exclusive for the two – any cryptocurrency offering payment functionality can use it to allow instant micro-transactions.
Lightning Network is powered by smart contracts, which are more popular with Ethereum. The astonishing thing, however, is that Lightning Network will not need miners to validate transactions. All transactions will be processed offline, with Litecoin’s blockchain recording them once they complete. Brilliant, right?
Removing miners, who in this case are middlemen, means that Litecoin will be retail ready. You can walk into a store and purchase a bar of candy and pay around 1,000 Litoshi, and the transaction would process instantly.
Why Is Litecoin A Good Investment?
Looking at Litecoin and all that it promises, we can agree on one thing – Litecoin will be among the coins making waves in the cryptocurrency industry! But what are some of the things that give it the head start? Why Litecoin and not other similar cryptocurrencies in the market? Here are some convincing reasons:
1. Litecoin is like Bitcoin but improved
Litecoin is produced from the source code of Bitcoin, so in the real sense, it’s much similar to Bitcoin – the pioneer and king of cryptocurrencies. The digital currency can handle pretty much anything that Bitcoin can handle, only on a better scale thanks to the improved technology it boasts. Litecoin introduces bigger blocks and more coins, making it extremely easy to adopt.
2. Experienced software developers behind it
That’s right. Litecoin is backed by a brilliant mind – Charlie Lee, who was previously working with Google and Coinbase. In order to focus all his energy and time in developing Litecoin, Lee announced that he would depart from his day job, making a promise that soon the digital currency would make its way into exchanges and merchants. Being an experienced folk in the crypto space gives investors more confidence that the digital currency is destined for greatness.
3. Integrates LitePay for Merchants
LitePay is expected to come with low transaction fees and more convenience for both sellers and customers. Its commission is capped at 1%, which is three times lower than that charged by credit cards (3%). Moreover, its fees are lower when compared to other similar systems such as BitPay, which charge an average of 5%
4. Great store of value
Yes, Litecoin is likely to be widely adopted because of its use in the retail industry, but that is not the only reason investors are flocking to put their money on this digital currency. See, just like other cryptocurrencies, Litecoin is also a store of value, especially judging from the price gains it has recorded in the past few years. The coin is likely to hit record highs in value in 2018 and beyond.
5. Cheaper and easier to mine
Even though Litecoin is similar in design with Bitcoin, it takes a different path when it comes to the proof-of-work algorithm. Bitcoin mining is processor-intensive and requires expensive hardware to validate transactions. Litecoin mining, on the other hand, Litecoin mining can be done by less processor-intensive and cheaper GPUs. This encourages many people to venture into mining the cryptocurrency and earn profits.
6. Among the top cryptocurrencies in market cap
Litecoin is among the top five concerning market capitalization. It had once enjoyed a moment of glory after beating most cryptocurrencies to be ranked second, after Bitcoin. Litecoin has the potential to grow significantly, something that might be achieved in 2018 after the company implements its integrations.
If you would like to learn more about Litecoin, Bitcoin and Blockchain technology check out our comprehensive documentary list.
Bottom Line – A word for the Wise!
We’ve probably read it on the internet or heard it from the real investors – you don’t invest in any cryptocurrency; you invest in a coin with tremendous potential! When you look at the cryptocurrency market and analyze the majority of the coins, you will realize that not all have the potential to grow. Some have weak ideas; others have inexperienced people behind them, and others are downright useless. The useful ones also are few and cannot match.
While Bitcoin is one of the most promising cryptocurrencies, we certainly can’t forget about Litecoin, which has enormous projects lined up for implementation. The cryptocurrency is similar to Bitcoin but comes with a number of upgrades to make it more convenient and easy to use. It processes transactions faster and its fees are incredibly low. If LitePay integration comes to reality, most retail merchants will be able to accept it and convert Litecoin to fiat currency instantly depending on the market value at that particular time. This beats the problem of price volatility and gives sellers and customers more confidence on the cryptocurrency. Whoever said that Litecoin is a “dark horse” waiting to take off is absolutely right!