Based in 2011 by Charlie Lee as a peer-to-peer (P2P) coin, Litecoin (CCC:LTC-USD) usually 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 start with, I generally see people loading up one only one or two tokens. Identical to a inventory portfolio ought to be diversified, a cryptocurrency account must also have quite a lot 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 hold all place sizes reasonable so that you just’re not over-leveraged.
On the similar time, keep watch over Bitcoin as a result of it’s nonetheless the “mom ship” of cryptocurrencies. Wherever it goes, different cash are prone to observe.
Analyzing the Litecoin Worth
In different phrases, the value 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 Could 9.
This lends credence to the concept that Bitcoin’s main and Litecoin’s following.
In any case, after the crypto crash of Could, the LTC value settled at round $174 on June 5. Shares have a tendency to maneuver slowly in the course of the summer season, however by some means I believe that cryptocurrencies don’t observe these sorts of guidelines.
Due to this fact, merchants shouldn’t let their guards up. Maintain an in depth watch on the Litecoin value and be happy to reap the benefits of any 20%-or-greater value dips which will happen.
Watch These Tweets
I might additionally advise cryptocurrency buyers to remain energetic, or at the very least watchful, on social media.
In the event you’re capable of monitor postings on Reddit boards like r/WallStreetBets, examine for a surge of curiosity in Litecoin as a possible buy-up goal.
Furthermore, you’ll need to keep watch over Elon Musk’s tweets. Prefer it or not, his postings have the facility to maneuver digital asset costs.
For example, Bitcoin and Litecoin declined in tandem after Musk posted a tweet on June 3.
This explicit 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 is perhaps irritating to contemplate that one particular person would have such a robust affect over cryptocurrency costs. However it’s what it’s, and merchants have to reply accordingly.
A Viable Different
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 “supplies transactions which course of four times faster than these by way of” 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 might be inbuilt favor of Litecoin as a viable various to Bitcoin – and plenty of different cryptocurrencies, for that matter.
On prime of all that, the LTC value is pretty low.
It’s not as little as among 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 properly.
Due to this fact, it’s cheap so as to add Litecoin to your crypto holdings, because it provides notable benefits over Bitcoin.
On the date of publication, David Moadel didn’t have (both instantly 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 supplied compelling content material – and crossed the occasional line – on behalf of Crush the Avenue, 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 Wanting on the Markets.
The views and opinions expressed herein are the views and opinions of the creator and don’t essentially mirror these of Nasdaq, Inc.