Litecoin was designed for cheaper transactions and to be more efficient for daily usage. When compared to Bitcoin, it was being used as a store of value for the long-term. On Litecoin, the coin limit market cap is much higher than Bitcoin, and the mining process is also relatively quick. Although smaller in size, the transactions are cheaper and faster.

Like Bitcoin, Litecoin is also a type of digital money that utilizes blockchain technology and can transfer funds between businesses or individuals. It makes sure that the public ledger of all the transactions is recorded. This helps Litecoin operate a decentralized payment system and free from any government control or censorship.

What is Litecoin?

  • Transaction speed

Though Litecoin needs more sophisticated technology to mine, its blocks may be generated up to four times faster. The financial transactions with Litecoin are also processed much quicker and can process a higher number over the same time.

  • Market cap

As compared to Bitcoin, Litecoin may have a smaller market cap, but it is still among the most traded cryptocurrencies.

  • Number of coins

Litecoin has a finite number of coins that are in circulation. Its number of coins are around four times more than Bitcoin.

  • Algorithms

To add the new blocks of cryptocurrency to the blockchain, the miners must solve the hash functions. Litecoin has different mining algorithms, and Scrypt is the hash function that is used for Litecoin. The Scrypt mining algorithm is much more memory intensive, thus giving the miners more opportunity.

How to trade Litecoin?

When Litecoin is bought on an exchange, its price is usually quoted against the US dollar. In other words, the US dollar can be sold to buy a Litecoin. If its price rises, then you can sell it for a profit because it is worth more than US dollars than when you bought it. If the price happens to fall and you plan to sell Litecoin, you may be making a loss.

What factors can affect the price of Litecoin?

  • Regulation

At present, cryptocurrencies are not regulated by the governments and the central banks. There might be a few questions about how this may change in the next few years and its impact on value.

  • Supply

Litecoin has a finite number available to be mined, and there can be fluctuation in availability because it depends on the rate at which coins happen to enter the market.

  • Press

It is the public perception, security, and longevity that can affect the price of Litecoin.

  • Adoption

Litecoin hasn’t been adopted yet as a method of payment by businesses or consumers. Some people see potential in blockchain technology, and they predict that this could become much adopted in the future.

Bottom Line

Once a currency can reach a critical mass of users who are confident about the currency, its representation, and that it won’t lose its value, it can sustain itself as a payment method. Litecoin may not be universally accepted and may have fewer users, as this cryptocurrency will be readily accepted and become stabilized. It will emerge as a standard currency of the digital realm.

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