Litecoin (LTC 0.51%) is a cryptocurrency that launched in 2011 to complete cryptocurrency transactions quickly and cheaply. It was developed using a copy of Bitcoin's (BTC -0.43%) source code, and it is one of the first altcoins, a term used to refer to every cryptocurrency other than the market leader Bitcoin.
Litecoin in its early years frequently ranked as the second-largest cryptocurrency. Its similarity to Bitcoin makes Litecoin popular among those looking for an affordable Bitcoin alternative. If you're considering an investment in Litecoin, keep reading to learn everything you need to know.
Image source: Getty Images.
How Litecoin works
Litecoin is a digital currency that is decentralized, meaning that it functions without relying on any centralized financial institution. Litecoin uses blockchain technology to process and record transactions, with batches of transactions continually adding more blocks of information to the Litecoin blockchain.
Litecoin miners use immense computing power to solve complex mathematical problems and earn the right to verify transactions, which adds new blocks to the blockchain. Litecoin miners are compensated in Litecoin.
As a currency, Litecoin can be bought, sold, and used for purchases with some merchants. Most Litecoin holders use one of these cryptocurrency apps or exchanges to purchase or sell the cryptocurrency:
- Coinbase (COIN 0.1%): Publicly traded cryptocurrency exchange that began offering Litecoin in 2017.
- Gemini: Crypto exchange that started offering Litecoin in 2018.
- PayPal Holdings (PYPL -0.37%): Global payments app that began enabling users to buy and sell cryptocurrency, including Litecoin, in 2020.
Risks of investing in Litecoin
Few businesses accept Litecoin or any cryptocurrency, which limits Litecoin's utility as traditional money. For investors, owning Litecoin is risky because it could eventually become worthless.
While every cryptocurrency has the risk of becoming worthless, Litecoin currently lacks a clear use case. While it was introduced in 2011 as an alternative to Bitcoin with faster and cheaper transaction fees, many cryptocurrencies have since launched that are faster or less costly to process than Litecoin.
Litecoin more recently has developed a reputation as a less sophisticated copy of Bitcoin. Its founder, Charlie Lee, during a bull market for crypto in December 2017, sold all of his Litecoin. While Lee claimed the sale was to avoid any perceived conflict of interest, many crypto investors viewed the move as a signal that Lee was no longer confident in Litecoin's long-term success -- a perception that has remained to this day.
Litecoin vs. Bitcoin differences
Here's a breakdown of how Litecoin and Bitcoin differ:
Cryptocurrency Metric | Litecoin | Bitcoin |
---|
Coin release date | Oct. 7, 2011 | Jan. 9, 2009 |
Maximum coin supply | 84 million | 21 million |
Average transaction time | 2.5 minutes | 10 minutes |
Halving interval for block rewards | 840,000 blocks | 210,000 blocks |
Mining algorithm | Scrypt | SHA-256 |
Data source: Litecoin.info.
The coin supplies of Litecoin and Bitcoin are capped, with Litecoin's maximum being four times greater. Litecoin transactions also process in about a quarter of the time as Bitcoin transactions.
Due to this difference in transaction times, Litecoin halves its rewards to miners every time 840,000 blocks are mined, whereas rewards to Bitcoin miners are halved with the mining of every 210,000 blocks. Rewards are halved to maintain the relative scarcity of these cryptocurrencies and preserve their value.
Litecoin's mining algorithm, Scrypt, is newer than the SHA-256 algorithm used by Bitcoin. It also doesn't require as much computing power. Mining algorithms are sets of rules that govern the computational work performed to mine a cryptocurrency and verify its transactions.
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Should you buy Litecoin?
Whether Litecoin succeeds or fails as a cryptocurrency depends on a few factors. The rate of user adoption matters, and, if more people buy Litecoin either to transfer funds or as a store of value, then its value is likely to increase. Litecoin's availability on several major exchanges is a plus for the coin.
But Litecoin doesn't receive much media attention, and a cryptocurrency's popularity plays a major role in its ability to gain value over time. Also, governments are still in the process of deciding how to regulate cryptocurrencies, and new regulations can lead to large price shifts for every cryptocurrency, including Litecoin.
With little in the way of competitive advantage, Litecoin may not be the best choice for investors. If you are interested in owning cryptocurrency as a store of value, then other digital currencies may be better options.
Lyle Daly has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin, Coinbase Global, and PayPal. The Motley Fool recommends the following options: short December 2023 $67.50 puts on PayPal. The Motley Fool has a disclosure policy.
FAQs
Litecoin (LTC) is a digital currency designed for fast, low-cost payments over the internet. Created by Charlie Lee in 2011 as an alternative to Bitcoin, it offers improved transaction times and a higher maximum supply, using a different algorithm (scrypt) for mining.
What is a realistic price prediction for Litecoin? ›
The expected minimum price of LTC is $71.30, while the average price is $83.90. By the end of 2024, the maximum price is anticipated at $104.86. The table below shows the maximum and minimum prices for each month of 2024.
Can Litecoin hit $1000? ›
Can LTC Reach $1000? It is a possible price goal in the long-term: many experts believe that this can happen either by 2030 or 2040.
What crypto does Motley Fool recommend? ›
Anders Bylund has positions in Bitcoin, Cardano, Coinbase Global, Ethereum, and Nvidia. The Motley Fool has positions in and recommends Advanced Micro Devices, Bitcoin, Block, Cardano, Coinbase Global, Ethereum, Mastercard, Meta Platforms, Nvidia, PayPal, Shopify, and Visa.
Is it good to buy Litecoin now? ›
Litecoin is a good investment because it has a lot of potential. Litecoin is similar to Bitcoin, but it is cheaper and faster. This makes it a good choice for investors who want to get into the cryptocurrency market without spending a lot of money. Currently, Litecoin is only worth about $50 per coin.
How much will 1 Litecoin be worth in 2025? ›
The Coincodex platform predicts Litecoin could reach $139.89 to $483.89 by 2030, and experts from Changelly forecast that it could reach minimum and maximum prices of $142.22 and $178.31 by the end of 2025.
How high will Litecoin be in 5 years? ›
Litecoin (LTC) Price Prediction 2030
Year | Price |
---|
2025 | $ 66.54 |
2026 | $ 69.87 |
2027 | $ 73.36 |
2030 | $ 84.92 |
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Which crypto will explode in 2024? ›
Top 10 Cryptos in 2024
Coin | Market Capitalization | Current Price |
---|
Binance Coin (BNB) | $79.354 billion | $543.77 |
Solana (SOL) | $62.688 million | $133.91 |
Ripple (XRP) | $31.963 billion | $0.567 |
Dogecoin (DOGE) | $15.525 billion | $0.106 |
6 more rows6 days ago
What is the highest price Litecoin has ever been? ›
The all-time high of Litecoin is $420.00.
Will LTC go up after halving? ›
After the two previous halvings, the price of LTC rallied significantly, jumping 14,200% after halving 1 and 1,574% after halving 2. However, in both cases the price declined significantly following these rallies. Litecoin's price slid by 73% in the 578 days after the first halving.
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What is the best crypto to invest in to become a millionaire? ›
Based on the report's findings, there appear to be two primary millionaire-maker cryptocurrencies: Bitcoin (BTC -0.56%) and Ethereum (ETH -0.12%).
What is the ultimate portfolio Motley Fool? ›
The Ultimate Portfolio is a carefully curated model portfolio created by Motley Fool's expert analysts. Its purpose is to offer a strategic roadmap that can lead to long-term investment success.
Is Litecoin a risky investment? ›
Risks Of Investing In Litecoin
As with any investment, there are some risks when investing in Litecoin. While businesses have begun accepting Litecoin, the current number is quite low, limiting its utility as a mode of payment. This could make it risky because a lack of adoption would mean it lacks utility.
What are the disadvantages of Litecoin? ›
Litecoin: - Advantages: Faster transaction times than Bitcoin, lower fees, established since 2011. - Disadvantages: Less adoption compared to Bitcoin and Ethereum, not as widely recognized.
Is there a future with Litecoin? ›
Our real-time LTC to USD price update shows the current Litecoin price as $63.48 USD. Our most recent Litecoin price forecast indicates that its value will increase by 0.46% and reach $63.77 by September 18, 2024.
What will Litecoin price target be in 2030? ›
LTC price forecasts 2030
They are suggesting a year-end price of $172, which is less than a quarter of the value of some other analysts.
Can LTC reach all-time high? ›
The all-time high is still a long way off. However, analysts do expect Litecoin to start a cautious recovery. Throughout the year, the price is projected to trend upward. In September the price will reach €56.18 and by December, it is expected to reach €135.03 euros.
Is Litecoin a good investment in 2024? ›
Our most recent Litecoin price forecast indicates that its value will increase by 3.3% and reach $62.65 by September 13, 2024. Our technical indicators signal about the Bearish Bullish 6% market sentiment on Litecoin, while the Fear & Greed Index is displaying a score of 37 (Fear).
Which crypto will boom in 2024? ›
Top 10 Cryptos in 2024
Coin | Market Capitalization | Current Price |
---|
Ethereum (ETH) | $287.89 billion | $2,393 |
Binance Coin (BNB) | $73.99 billion | $507.14 |
Solana (SOL) | $62.45 million | $133.76 |
Ripple (XRP) | $30.62 billion | $0.54 |
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