Claire HunteLitecoin, an altcoin alternative to Bitcoin, has seen explosive growth of over 4,000% year to date according to Coinmarketcap but investors should still have some care.
Litecoin which was created by a former Google employee and director of engineering at Coinbase, Charles Lee, has seen a surge in its ask price to a record high at $327.79 as of Tuesday 14:54 UTC, up more than 50% on the day. It has since fallen back slightly
Lee tweeted about the $1bn volume traded milestone earlier on Tuesday noting tongue-in-cheek that it “dwarfed the volume of the other two lesser known coins".
$1B LTC volume on @GDAX in the past 24 hours. That dwarfs the volume of the other two less well known coins on there.
Litecoin is one of the 1,194 cryptocurrencies in circulation according to JustCryptoNews and many of them are and should be forgettable. Investors look to alt coins as a way of diversifying digital currency portfolios.
Rising but still small fry
The current rate is $316/$324 (bid/ask) and its current market cap is $17bn still comparative small fry to Bitcoin’s current market cap of $287bn. Bitcoin Cash (BCH) which is a Bitcoin fork was up 10.96% at $1,546.64 on Tuesday 15:34 UTC.
And Lee warned speculators to be prepared for a significant drop in price, warning he had seen bear markets in Litecoin before.
Ok, sorry to spoil the party, but I need to reign in the excitement a bit...
Buying LTC is extremely risky. I expect us to have a multi-year bear market like the one we just had where LTC dropped 90% in value ($48 to $4). So if you can't handle LTC dropping to $20, don't buy!
Litecoin’s uniqueness is that it is fast and is described as offering ' instant, near-zero cost payments to anyone in the world'. As an alternate to Bitcoin it takes 2.5 minutes for Litecoin to generate a block, or transaction, in comparison to Bitcoin’s 10 minutes according to Forbes.
The internet currency is capable of handling higher transaction volume compared to Bitcoin which helps merchants get swifter confirmation times. It’s mining reward set up means the network also has more currency units in circulation (expected to produce 84 million).
Earlier this year, it was a question of whether Ethereum, another altcoin, would topple Bitcoin from its perch and the answer so far has been resounding. It’s now Litecoin’s turn as a potential contender and the answer to the question is still to come.