How To Trade Litecoin LTC In 2023

Litecoin was conceived as a complementing, rather than competing, cryptocurrency to Bitcoin. However, because Litecoin uses scrypt (as opposed to Bitcoin’s SHA-256) as a proof-of-work algorithm, mining hardware such as ASIC miners or a GPU mining rig requires advanced white label crypto exchange significantly more processing power. Litecoin was launched with the aim of being the “silver” to Bitcoin’s “gold.” Like Bitcoin, Litecoin is a peer-to-peer internet currency. Lee developed Litecoin with the aim to improve on Bitcoin’s shortcomings.

  1. By the end of that month, Litecoin reached a market capitalisation of $1 billion.
  2. Firstly, you won’t be able to make profits on the frequent value fluctuations that occur around the clock as it simply isn’t practical to keep shifting your Litecoin.
  3. It should be remembered that day trading carries an inherent risk, so you should always bear this in mind when budgeting for transactions.
  4. For example, some may only offer crypto and forex, whilst others will offer a whole complement of trading markets, including stocks, indices, and commodities.

Whilst Litecoin inevitably bears many similarities to its predecessor, there are a few key differences that have made LTC stand out as a trading asset with serious potential for growth. Most notably, Litecoin blocks are created four times faster than those of Bitcoin – an issue which has dogged the latter in recent years. The creation and transfer of Litecoin is based on an open-source cryptographic protocol, and is not managed by any central authority. Firstly, you’ll want to decide if you are just looking to trade Litecoin and perhaps some other cryptocurrencies, or if you’ll be wanting to explore other financial asset classes.

As we have already touched upon, CFD trading allows a trader to profit from the price movement of an underlying asset without ever owning that asset outright. A CFD  is a contract between two parties that tracks variation in the price of a given asset, without that asset ever actually trading hands. The advantage of CFDs is that you have the option to go either long or short – long if you think the price of Litecoin will increase, short if you believe it’s likely to fall. In order to buy Litecoin, you’ll first need to set yourself up with a cryptocurrency wallet to store the currency.

The market then crashed between January and February 2018, and Bitcoin free fell, dropping 65% in value. The value in most cryptocurrencies is derived from their potential; how they could be used to advance society in the future. Without institutional acceptance however, the potential value, will remain merely potential, but whether this implies that cryptocurrencies are overvalued is another question. Litecoin has implemented several features since its launch intended to improve its transaction speed without compromising the security and integrity of the network.

Litecoin Mimblewimble Upgrade

Litecoin block rewards are designed to halve every 840,000 blocks (approximately every four years), with the first halving coming on the 25th of August, 2015, and the second on the 5th of August, 2019. Litecoin, a source code fork of the Bitcoin Core client, inherits the Scrypt mining algorithm from Fairbrix but uses a scarce token supply similar to Bitcoin. It used Scrypt instead of Bitcoin’s SHA-256 to make it GPU-resistant.

Step 1: Choose a Litecoin Trading Site

Litecoin has a block time of just 2.5 minutes and extremely low transaction fees, making it suitable for micro-transactions and point-of-sale payments. Trading Litecoin is done via an exchange or broker and these allow both short and long selling – in other words speculating either a price increase or decrease. This kind of trading is done with a much shorter turnaround than with HODLing – successful cryptocurrency traders will often make numerous transactions in a single day. When trading in this way, you never actually own the underlying asset. Instead, you speculate on price movements via contracts for difference (CFDs).

How do I start trading Litecoin?

However, a novice investor is most likely going to want to focus on LTC/USD. In a nutshell, Litecoin trading involves speculating on the price of the token –  trying to predict whether its value will increase or decrease over a given period. Litecoin was released via an open-source client on GitHub on Oct. 7, 2011, and the Litecoin Network went live five days later on Oct. 13, 2011.

By making Litecoin’s consensus algorithm memory intensive, Lee sought to thwart the hardware arms race, though in practice, that didn’t happen as the rise of GPU mining answered the need for greater RAM. On October 2023, 1 LTC was worth around $61, making it the 15th-largest crypto with a market cap of just over $4.5 billion. This website is using a security service to protect itself from online attacks. There are several actions that could trigger this block including submitting a certain word or phrase, a SQL command or malformed data. We highly recommend sticking with a reputable and regulated online broker such as eToro.

Since then, it has exploded in both usage and acceptance among merchants and has counted among the top ten cryptocurrencies by market capitalization for most of its existence. Litecoin uses a hashing algorithm called Scrypt (pronounced es-crypt). But it found greater acceptance in the cryptocurrency community after the 2011 Tenebrix project modified Scrypt to work with regular CPUs for mining. Litecoin is a proof-of-work blockchain, which means that it is secured by a wide network of computers dedicating their computing power to the security of the network. The main blockchain’s usage is reduced because all that is recorded is the opening and closing of the Lightning Network’s channels themselves.

It was initially designed to address the developer’s concerns that Bitcoin was becoming too centrally controlled, and to make it more difficult for largescale mining firms to gain the upper hand in mining. While eventually unsuccessful in preventing enterprise miners from taking over the lion’s share of Litecoin mining, the cryptocurrency has reworked itself into a minable coin and a peer-to-peer payment system. While many cryptocurrencies exist that can process transactions faster and cheaper than Litecoin, it has the advantage of being established and battle-tested.

For participating in the act of mining, miners are rewarded with Litecoin. A Litecoin halving refers to an instance of halving the amount of Litecoin rewards that miners are given for each block. EToro accepts credit and debit cards, and also e-wallets like PayPal, Skrill, and Neteller. Whilst bank account deposits are also accepted, you should note this is the slower option.