Based in 2011 by Charlie Lee as a peer-to-peer (P2P) coin, Litecoin (CCC:LTC-USD) sometimes will get second billing in comparison with the extra well-known Bitcoin (CCC:BTC-USD). But, I don’t consider that cryptocurrency merchants ought to ignore Litecoin.
To begin with, I generally see of us loading up one only one or two tokens. Identical to a inventory portfolio ought to be diversified, a cryptocurrency account also needs to have a wide range of cash.
This doesn’t imply that you need to simply put a bunch of random crypto cash in your account. Think about what makes every asset totally different from the others, and preserve all place sizes reasonable so that you just’re not over-leveraged.
On the identical time, control Bitcoin as a result of it’s nonetheless the “mom ship” of cryptocurrencies. Wherever it goes, different cash are prone to comply with.
Analyzing the Litecoin Value
In different phrases, the worth actions of the 2 currencies are comparable, a lot of the time.
And whereas I can’t show this, I’m going to imagine that Bitcoin is main Litecoin, and never the opposite method round.
Think about this: Bitcoin peaked at $64,863.10 on April 13, after which Litecoin peaked at $412.96 on Might 9.
This lends credence to the concept Bitcoin’s main and Litecoin’s following.
In any case, after the crypto crash of Might, the LTC worth settled at round $174 on June 5. Shares have a tendency to maneuver slowly throughout the summer time, however by some means I believe that cryptocurrencies don’t comply with these kinds of guidelines.
Subsequently, merchants shouldn’t let their guards up. Maintain a detailed watch on the Litecoin worth and be at liberty to reap the benefits of any 20%-or-greater worth dips that will happen.
Watch These Tweets
I’d additionally advise cryptocurrency buyers to remain lively, or not less than watchful, on social media.
Should you’re in a position to monitor postings on Reddit boards like r/WallStreetBets, verify for a surge of curiosity in Litecoin as a possible buy-up goal.
Furthermore, you’ll wish to control Elon Musk’s tweets. Prefer it or not, his postings have the facility to maneuver digital asset costs.
As an example, Bitcoin and Litecoin declined in tandem after Musk posted a tweet on June 3.
This specific tweet featured the hashtag #Bitcoin, a broken-heart emoticon, and an image displaying an sad couple and a reference to some Linkin Park lyrics.
It may be irritating to contemplate that one particular person would have such a powerful affect over cryptocurrency costs. However it’s what it’s, and merchants have to reply accordingly.
A Viable Various
Maybe Litecoin doesn’t get as a lot consideration as Bitcoin as a result of folks aren’t conscious of its benefits.
For instance, as InvestorPlace contributor Alex Sirois factors out, Litecoin “gives transactions which course of four times faster than these by” Bitcoin.
Moreover, InvestorPlace contributor Ian Bezek observes that Litecoin generates rewards for miners each 2.5 minutes, versus each ten minutes with Bitcoin.
Not solely that, however Litecoin is understood to be comparatively much less power intensive.
Reportedly, Litecoin has been rated at 0.12 kilowatt hours per transaction. That’s an unlimited enchancment over Bitcoin’s whopping 707 kilowatt hours per transaction.
Given these benefits, a robust argument may very well be inbuilt favor of Litecoin as a viable various to Bitcoin – and quite a few different cryptocurrencies, for that matter.
On high of all that, the LTC worth is pretty low.
It’s not as little as a number of the cash on the market that price lower than a greenback, however 1 LTC is actually extra reasonably priced than 1 BTC.
The Backside Line
The precept of diversification doesn’t solely apply to shares. It applies to cryptocurrency portfolios, as effectively.
Subsequently, it’s affordable so as to add Litecoin to your crypto holdings, because it presents notable benefits over Bitcoin.
On the date of publication, David Moadel didn’t have (both straight or not directly) any positions within the securities talked about on this article. The opinions expressed on this article are these of the author, topic to the InvestorPlace.com Publishing Guidelines.
David Moadel has offered compelling content material – and crossed the occasional line – on behalf of Crush the Road, Market Realist, TalkMarkets, Finom Group, Benzinga, and (after all) InvestorPlace.com. He additionally serves because the chief analyst and market researcher for Portfolio Wealth International and hosts the favored monetary YouTube channel Trying on the Markets.