Cryptocurrency has changed the financial world. Now, businesses and countries consider using crypto assets as payment or legal tender. Litecoin (LTC) has faced bearish runs but also experienced periods of relief with an all-time high. Therefore, you may need to know why LTC is valuable in the crypto market regarding its resilience to a price rebound. This takes a semblance of the things crypto traders must know about trading in the crypto market to help guide their dedications.
We can not talk about significant cryptocurrencies today without stating Litecoin. This is because of its unique features that make Litecoin popular and valuable among crypto traders and investors. Its innovative features have made it more popular and expensive than other types of cryptocurrencies that came after it.
Therefore, this article aims to highlight the factors that have significantly contributed to the value of LTC in the highly competitive crypto market.
Understanding Litecoin (LTC)
Litecoin is a decentralised peer-to-peer (P2P) cryptocurrency that also serves as an open-source software project free of censorship. As such, it enables an almost-zero cost payment to anyone worldwide. Launched in 2011 by Charles Lee, a former Google engineer, Litecoin has hitherto been a strong force in the volatile crypto market. This is the ability of the coin to be navigate through the waters of both bull and bear crypto market without losing all of its value.
This crypto asset was created as a source code fork of the Bitcoin Core client, which differs from Bitcoin’s reduced block generation time of 2.5 minutes. But Litecoin has a higher supply of LTC coins, faster difficulty retargeting, a different hashing algorithm, and a slightly modified graphical user interface (GUI).
This crypto asset is a modified version of Bitcoin with a shorter block generation time of 2.5 minutes.
Litecoin has more coins, adjusts difficulty faster, uses a different algorithm, and has a slightly changed user interface.
Litecoin is like a silver version of Bitcoin. It was created two years after Bitcoin and drew inspiration from it. Therefore, the history of Litecoin is incomplete without referring to Bitcoin.
Meanwhile, LTC has some distinguishing features that give it an advantage over Bitcoin and other cryptocurrencies. These include:
- Litecoin confirms transactions four times faster than Bitcoin, with its targeted block time at 2.5 minutes compared to the 10 minutes of Bitcoin
- LTC has a maximum supply of 84 million coins as against the 21 million BTC total supply
- Litecoin merge-mined with Dogecoin, thereby increasing miner compensation network security for the two blockchains
- The four times speed of LTC makes mining difficulty retargets occur about every 3.5 days compared to about every 14 days for Bitcoin.
In light of these above features, there is a lingering discourse if Litecoin will be better than Bitcoin, but only time will tell between these two crypto assets.
Strong Market Presence And Adoption
Since the launch of Litecoin in 2011, the crypto asset has had its bearish and bullish runs in terms of its price in the crypto market. But as every cryptocurrency is currently rallying a new price mark, it is not excluded from that run.
When writing this article, the LTC price is about $100.35, with its daily trading volume up by 9.16% in the last 24 hours. Therefore, it has a market cap of over $7.3 billion. This makes LTC the 10th-largest cryptocurrency by market cap, which spells good fortune as a coin to trade or invest in. For instance, you can sell Litecoin in Nigeria at a good price now if you want to profit from the firm price of LTC.
Like Bitcoin, Litecoin is also gaining popularity among businesses worldwide. Companies are collaborating with Litecoin to attract traders and investors.
Since 2022, Pay Pal allows users to transfer LTC, BTC, and ETH between PayPal, wallets, and exchanges.
Litecoin’s partnership with other businesses helps increase market sentiment and boost its price. In 2021, there was fake news about LTC teaming up with Walmart.
This rumour caused LTC’s price to rise by 30% until it was proven false.
Faster Transaction Confirmations And Lower Fees
Let’s reiterate that Litecoin has a target block time of 2.5 minutes. This means that the transaction confirmation speed of Litecoin is 56 transactions per second. This makes Litecoin faster than Bitcoin, which can only achieve confirming 7 trades in a second. This remarkable transaction confirmation speed of Litecoin makes it the second most popular cryptocurrency for making payments.
Moreover, LTC has one of the lowest transaction fees, which gives it leverage to pique people’s interest in adopting it as a payment, especially as a preponderance of cross-border payments have been digitised.
The average transaction fee on Litecoin is $0.05 – which is cheaper than on Bitcoin, which has a transaction fee of $6.18. Litecoin also has a lower feel than other payment methods like Paypal that has a transaction fee of over 2.99%
Segregated Witness (SegWit) Implementation
SegWit is a protocol upgrade developed in 2015 to proffer solutions to the scalability problem that blockchain networks encounter. The idea behind SegWit is to reorganise block data to ensure that signatures no longer exist with transaction data. Hence allowing more transactions to be stored in a single block to increase the transaction throughput of the network.
The implementation of this protocol upgrade is peculiar to Litecoin and Bitcoin. For Litecoin, SegWit has been instrumental in its lower transaction fee of less than 1%, attracting people to use it as a payment gateway. This is also evident in the scalability of Litecoin, such that it can process 56 transactions in a second at a reduced cost.
However, an upgrade to SegWit, which is SegWit2x, would increase the block size so that Litecoin could still confirm more transactions at high speed without a glitch.
Active Development And Community Support
Litecoin is notable for having a strong and dedicated community of supporters who are active in innovating cryptocurrency. The Litecoin Foundation, a non-profit organisation that supports Litecoin development, has a team of developers working to improve the technology behind Litecoin. This strong community support ensures that Litecoin will grow steadily to become a reliable investment option.
It is important to note that the next Litecoin halving event is scheduled for August 2023, which is expected to reduce the mining reward of LTC from 12.5 LTC to 6.25 LTC per block.
Historical Performance And Market Sentiment
LTC had an all-time high of $410.26 on May 10 2021, in which the current price of $93.32 is lower than the all-time high by -77.14%. The crypto asset also recorded an all-time low of $1.15 on January 14, 2015, with the current price higher than the all-time low by 8,063.32%.
When writing this article, LTC is underperforming, with a price decline of -16.80% in the last 7 days. This is on the heels of the underperformance of the global market, which is down by -3.40%. However, the Litecoin community has a positive sentiment as over 80% of its users are good with the market outlook of LTC.
Conclusion
Litecoin is a digital currency that is gaining popularity in the crypto market. It is known for its ability to handle many transactions quickly and at a low cost. This makes it a good investment option for many people.
However, it is important to know that LTC price is also susceptible to the volatility of thr crypto market.
So, before you trade or invest in LTC, it’s important to study and understand price movements and predictions in the market.
