Litecoin Review:
A Summary Of Its Value, Algorithm, & As An Investment

Should you invest in Litecoin? A review from Cryptozine

While BTC has been stealing the headlines, Litecoin has been doing just as well and is moving from milestone to milestone.

It was created to address the shortcomings of other digital currencies and even today, it is still one of the best options for an investor. But what is it that makes this cryptocurrency so special?

To answer this question for you and make your investment decision easier, we are going to take an in-depth look at this crypto. We will look at how and why it was developed, the technology that makes it tick and how you can buy and store it.

If you are not yet aware, cryptocurrencies are a revolution in storing and transferring value. Using online tokens, you can securely and privately move money with the click of a mouse. To get started, let’s take a look at how Litecoin works.

What Is Litecoin?

Like any other investment, it is crucial you understand how this digital currency works before getting involved. So we are going to start off with an overview of this altcoin’s origins and its unique features.

This crypto was started in 2011 by former Google engineer Charles Lee. He was involved with BTC for some time and saw some critical flaws, which he hoped to address with his own form of virtual currency.

It’s commonly called the silver to Bitcoin’s gold and maintains a position in the top five cryptocurrencies by market cap. Now, let’s take a look at some of the unique features that separates LTC from the competition.

presentation for LTC value

Fast Transactions

logo of LTC

One of the problems Lee identified with Bitcoin was transaction speed and he managed to improve on this with his new currency. By using an algorithm that processes a block every 2.5 minutes, this crypto is capable of up to eight times as many transactions per 10 minutes.

This popularized the view that BTC is for holding and investing, while Lite coin is much more convenient for spending. Because of this faster transaction speed, it is a very liquid digital currency, with large trades that don’t adversely affect the market.

Strong Network

The success of a cryptocurrency hinges on the strength of the computing power in its decentralized network. In this respect, Litecoin is one of the best in its class as far as our analysis goes.

The cryptocurrency has a very stable hashrate, which is the measure of available computing power on the network. Although the raw computing power on the network is not as high as the Bitcoin’s, the algorithm used is not as demanding.

And so the practical difference is not as big as it seems. Next, let’s look at some of the technology used in this virtual currency.

muscle man illustration

How Does Litecoin's Algorithm Work?

At a fundamental level, this digital currency utilizes blockchain technology like every other popular cryptocurrency. The main difference is the way the technology has been implemented.

Although there are a lot of unique points, we are going to focus on the encryption type used, the implementation of smart contracts and the positive innovation driven community.

Encryption

encrypted blockchain and algorithm

As mentioned, Litecoin’s algorithm is like the one used by Bitcoin with some key differences. Based on the same SHA-256 algorithm, this cryptocurrency uses the Scrypt variant. Scrypt favors serialized rather than random calculations.

What this means on a practical level is available memory is more useful for solving blocks instead of raw processing power. This has allowed mining to be far more democratic, with small-scale home mining still possible.

The situation benefits the average user while increasing the strength and resilience of the network as a whole.

Smart Contracts

Smart contracts are a hot topic right now, spurred on by the success of Ethereum. What many people don’t realize is Litecoin has also introduced the same functionality.

deal over the internet

A smart contract is a secure digital contract that sets key targets to be met before executing a transaction. There are a lot of ideas about how these can be used and smart contracts are likely to revolutionize the way we work and trade online soon.

This digital currency uses sidechains for its smart contract implementation so the main blockchain is not compromised. The decision was a consensus reached by the community, which is one of the massive strengths of this crypto.

Active Support and Development

If you have looked in detail at Bitcoin before, then you haven’t missed the infighting. As a community project owned by the users, BTC has experienced massive trouble making changes because it’s hard to reach a consensus.

Where users of Bitcoin have failed on many occasions to agree on changes, Litecoin incorporates new technologies without any problem. This is due to the strength of the community, which is cooperative and forward looking.  

It may seem like a minor point, but such an atmosphere of cooperation will be necessary for this digital currency to continue being relevant into the future.

Here’s some information on how you can store this cryptocurrency.

community online

How Do You Store Litecoin Cryptocurrency?

wireless connection using this blockchain technology

You first need to decide whether you want to store your coins digitally or physically.

Digital storage is definitely more convenient, but it can be less secure. Most people opt for an encrypted wallet, which is software that holds your coins on any PC. But holding onto it this way leaves your LTC cryptocurrency open to hacking so you need to be especially careful.

Storing this virtual currency is straightforward. It follows the same basic process as all the other cryptocurrencies.

You can also store digitally but on removable media like a flash drive or portable hard drive. It’s less risky than a PC wallet application but it is still possible to have corrupted files.

Some people who don’t need quick access to their Litecoin choose to create physical printouts of the codes that represent their coin, which they then put in a physical location.

As long as you have somewhere safe to keep the codes, this is definitely the safest option. Now, let’s look at whether or not you can still mine this virtual currency.

Can You Mine LTC Coins?

The great news is you can definitely still mine this crypto, even if you are using consumer grade components. The hashing algorithm used does not favor specialist mining hardware used by the big commercial miners.

Regular people still have the opportunity mine this digital currency at home. If you have been put off by the investment needed to mine other currencies, Litecoin could be a great way to get started.

Maybe you would prefer to buy instead of mine though. It is certainly the easiest way to get a large number of digital coins. Here’s how you can purchase this altcoin.

How to Buy Litecoin: A Simple Guide

If you are not up to the effort of mining yourself, it is also very easy to buy this cryptocurrency on almost any exchange. Because it’s been around for so long and is well regarded, any decent exchange will offer Litecoin.

Like buying shares online, all you need to do is fund your trading account and you can start buying. The online exchanges make the process easy and act as the escrow between you and the owner when you are buying.

Once you have some of this crypto, you can then transfer it to your own wallet or keep it within the exchange for trading.

buy LTC online for normal price value

Before you part with your hard earned cash though, you should be up to date on the latest news and developments. Here’s what we know.

Reviewing the Facts Before You Start Investing...

When investing in any cryptocurrency, you need to keep a close eye on new developments. Due to the speed technology evolves, cryptocurrencies are also constantly changing. Here’s some of the latest news on this digital currency.

The Lightning Network

Under development for some time now, the ‘Lightning Network’ is a new way of processing crypto transactions instantly for reduced fees.

This is facilitated by a specialized wallet called ‘ZAP!’. Although this technology promises to be a game changer, it’s going to take some time until the developers are happy with the security and stability.

Caution like this is great to see, as it helps to maintain the integrity of the network.

bolt sign

Colored Coins

This upcoming change is aimed directly at the hype around ICOs generated by other new cryptos like Ethereum.

You can see the rest of the cryptos here below: Cryptozine.com/best-cryptocurrency

Anyhow...

The Litecoin take on this is ‘Colored Coins’, which will give the functionality of ICOs and much more. It may also be possible to assign a cryptocurrency that signifies ownership, or a share of ownership, over a physical asset.

Atomic Swaps

One great function that will be unlocked with the Lightning Network is atomic swaps. This will allow someone owning Litecoin, or one of a select few digital currencies to trade seamlessly.

Right now, trades between cryptocurrencies move through paper money first, even if it seems to be a direct trade between currencies in your trading interface.

 If crypto currencies continue to gain popularity, then separating them from traditional currency is the next logical step.

giving cash and other currencies

It won’t be easy to implement this new protocol but the fact that Litecoin is leading the way on this is great news for the currency and anyone holding it. As you can see, there is a lot changing with this crypto, so is now the right time to invest?

So, Should You Start Investing in Litecoin?

This is the big question everyone has right now - is it a good time to invest in Litecoin? We will give you our thoughts on the matter but of course, this is only our opinion and we encourage you to do your own research.

First of all, we need to consider the current price of Litecoin. Although it has increased in line with Bitcoin since it was created, recently it has relinquished the second spot in terms of market cap to others like Ethereum.

The rise of these other cryptos is directly related to the new technologies they offer. Luckily, the Litecoin team is working hard to implement new and exciting technology. As these start to be revealed, it’s reasonable to expect the market cap of the cryptocurrency to increase.

Next, you need to look at the long-term viability of the crypto. In that respect, Litecoin has a lot left in it. As we explained already, this coin can process transactions way faster than others on the market and they are even working on making it instantaneous.

As you can see, the future looks bright for Litecoin, which makes now a good time to invest if you believe in the direction that the development team is taking.

First of all, we need to consider the current price of Litecoin. Although it has increased in line with Bitcoin since it was created, recently it has relinquished the second spot in terms of market cap to others like Ethereum.

The rise of these other altcoins is directly related to the new technologies they offer. Luckily, the Litecoin team is working hard to implement new and exciting technology. As these start to be revealed, it’s reasonable to expect the market cap of the crypto to increase.

man thinking about investing in LTC

Next, you need to look at the long-term viability of the cryptocurrency. In that respect, Litecoin has a lot left in it. As we explained already, this LTC coin can process transactions way faster than others on the market and they are even working on making it instantaneous.

As you can see, the future looks bright for Litecoin, which makes now a good time to invest if you believe in the direction that the development team is taking.

The content of this post is for educational purposes only. Please do your own research and consult a financial professional before making any investment decisions.