Bitcoin is what everyone thinks, turning to the cryptocurrency market. However, it is unlikely that bitcoin will rise in price as much as cryptocurrencies with smaller market capitalization. Tell why investors should pay attention to the less well — known cryptocurrency litecoin.
What do litecoin and bitcoin
At the most basic level both cryptocurrencies are very similar. This is mainly due to the fact that the money originally borrowed code of bitcoin. Common features include bitcoin mining limit proposals and the reduction of the remuneration for the block every four years.
Both coins rose significantly in 2017. The exchange rate of bitcoin (Bitcoin) went from $950 to almost $20 000, the price of litecoin (LTC/USD) started the year with $4.5 and jumped to $360.
The difference between bitcoin and litecoin
However, between the cryptocurrency there are a few differences and this is why investing in one can prove more profitable in the future.
The transaction rate
The first key difference between the two coins — the difference in speed of transactions. In this parameter leads the litecoin transaction with cryptocurrency are verified much faster. Generation of the block in the bitcoin network takes about 10 minutes, lidoine appears a new block every 2.5 minutes. Thus, litecoin is more convenient coin for users conducting transactions.
The algorithm of mining
To check the units in both cases, use mining, but the developers approaches to it differ. Bitcoin uses the SHA-256 algorithm, complicating the search for new blocks. Currently, the lucrative mining of cryptocurrencies in SHA-256 require professional equipment and ASIC-miners.
He is also overly complicated, so very few individuals have achieved success in bitcoin mining. Usually mining BTC do large companies that can afford the costs of equipment, operation and maintenance.
On the other hand, litecoin uses Scrypt simplified algorithm that extract it on a PC connected to the Internet. It also reduces the amount of electricity consumed.
The Creator of bitcoin is still not known and is hidden behind the pseudonym Satoshi Nakamoto. The Creator of litecoin — Charlie Lee, a former Google engineer and cryptomnesia (although he recently sold his LTC).
Lee has repeatedly called litecoin silver and bitcoin — the “gold” of the cryptocurrency world. Judging by internal dynamics, they may soon turn the tables. However, we should not forget about the high popularity of bitcoin. Largely thanks to her he is the leader on the market.
Which cryptocurrency is best to buy for the long term?
Technologically litecoin is based on bitcoin, but the cryptocurrency was able to overcome the shortcomings of his older brother and become better. This ensures the growth of interest in it in the future when investors will start to realize the advantages of litecoin compared to bitcoin.
In addition, developers continue to conclude new partnership agreements is vital to the success of cryptocurrency in the future. They signal about the legitimacy and faith in the project.
Another important reason why litecoin acts as a more preferable investment in the long term, is that its current price is relatively low, and the income potential is high. Buy one LTC for $50, you can earn $300 or more, the maximum risk is limited to the initial investment.
To purchase 1 BTC, you will have to invest about $6500, and it’s very unlikely that bitcoin will rise in price as much as cryptocurrencies with smaller market capitalization. It is clear that the money is better invested in the asset with the lowest risk and the highest potential income.
Trade on cryptocurrency market involves significant risk and not be suitable for all investors. This article should not be construed as a recommendation/call to action. Every trader is obliged to assess the risks taking into account its financial position. ihodl.com not responsible for possible losses.
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