Litecoin began trading back in 2013 and has seemingly been in the top ten cryptocurrencies ever since. Essentially an early Bitcoin derivative, Litecoin sees excellent marketing capitalization and hit the market with an initial value of one billion dollars. It shares a similar setup to its predecessor, Bitcoin, and offers a major draw with its incredibly low transaction fees. It’s an excellent crypto investment for both the trading novice and the more seasoned veteran. If you’re ready to start investing in Litecoin, keep these tips in mind.
Litecoin was created by former Google engineer Charlie Lee by tinkering with the open-source code of Bitcoin. Lee’s ultimate goal was to take the structure of Bitcoin and reduce the require computational power and well as dramatically speed up transactions. While Bitcoin is often referred to as “digital gold,” as its little brother, Litecoin is fondly termed “digital silver” by members of the crypto community.
Much like Bitcoin, it uses a decentralized model so it’s able to flow freely across the Internet. However, while Bitcoin was the first currency to make use of several technologies, such as blockchain, Litecoin uses them much more effectively.
Using a better blockchain
Simply put, blockchain technology is the foundation upon which all digital currencies are built. To break it down, every time an exchange or transaction happens across a digital currency network, it is stored in a block of data which is then added onto a constantly growing chain. Hence the term blockchain. Even if users remain anonymous, all blockchain information is public domain. This makes blockchain technology incredibly secure when compared to traditional financial networks.
Litecoin appeals to those interested that heightened sense of security as well as speed. Whereas the standard Bitcoin transaction often takes upwards of ten minutes, Litecoin confirms transactions every two and a half minutes on average. In addition, recent speed tests show that blockchain improvements enable Litecoin to process high-speed transactions in mere seconds, though this isn’t a constant.
Ease of purchase
One of the biggest consumer appeals is how easy it is to acquire Litecoin. If you’re new to cryptocurrency and aren’t sure of which exchange to use, your best bet is Coinbase. It’s one of the largest and most user-friendly exchanges available. It has a community that’s welcoming to newcomers with a large breadth of initial trading information available.
Getting started on Coinbase is as simple as creating and verifying an account. From there, you’re able to check stats on currency performance, verify the price of Litecoin, purchase various coins, and start trading. Coinbase accepts both credit card payments and banking transfers. Which you choose will vary based on your specific needs.
For example, credit card payments are much quicker to confirm but have lower limits. On the other hand, bank transfers are known to take up to a week in time but they come with the added benefit of much higher transfer limits. Once you’ve decided which method is the best for you, purchase some Litecoin and start trading.
As with any new trading strategy, it’s best to start small. Conduct a few low-risk trades to get a better idea of how the exchange works. Be patient at first. It’s easy to get overwhelmed by all the terminology and navigating new exchanges doesn’t make it easier, but you’ll grasp it over time. From there, move into more advanced strategies. If you’re ever unsure of trading strategies, it never hurts to contact a financial advisor.
Remember, with most strategies, your best bet is to buy low and sell high. This way, you’re much more likely to see profits. Litecoin is an excellent investment due to its ease of purchase and use. Trading it takes a sharp eye and there’s a bit of a learning curve but you’ll master it sooner than you think!