Crypto Investors Should Add Litecoin To Supercharge Their Portfolios

Litecoin (CCC:LTC-USD) has been one of the best performing crypto plays in the past year or so. Its 12-month returns are at an incredible 548%, outperforming the industry leader in Bitcoin (CCC:BTC-USD) during the same period. Often described as Bitcoin-lite, the crypto has been considered to be in cooperation with Bitcoin. However, its unique features, stellar performance, and brighter outlook suggest that it could become the go-to medium of exchange for crypto users.

Image of one litecoin in front of many stacks of litecoins

Source: Wit Olszewski / Shutterstock.com

Litecoin was launched back in 2011 by software engineer Charlie Lee as an open-source, peer-to-peer digital currency. It was intended to serve as a “silver to Bitcoin’s gold” and is essentially a software fork of the crypto giant. However, it has a few distinctions, which have made it more accessible and viable for digital currency users.

It has shed more than 3.5% of its value in the past month. This is in line with the market, which has struggled to gain momentum in the past few weeks. However, the headwinds are all temporary, and LTC should be back to winning ways again. Most analysts are bullish about its prospects so far, making it one of the best investments in the sector.

With that being said, let’s dive right into the key differentiators for Litecoin and its price predictions.

Litecoin Versus Bitcoin

Though Litecoin has been known as simply an off-shoot of Bitcoin, few distinguishing features make Litecoin more attractive. Firstly, Litecoin prioritizes transaction speed and has a significant edge over Bitcoin in this area. For example, the Bitcoin transaction time is around nine minutes per transaction depending on the network traffic, while for Litecoin, it is around 2.5 minutes.

Moreover, it carries a lower fee than Bitcoin, averaging at around 0.0002 LTC per transaction. For Bitcoin, the fee is at roughly 0.00025 BTC or more depending on the congestion of the network. Additionally, Bitcoins fee continues to rise in line with its lofty price.

Furthermore, Bitcoin’s supply is significantly lower than Litecoin’s. The Bitcoin network is limited to 21 million coins, whereas Litecoin can accommodate close to 84 million coins. However, as both cryptos can be divisible into nearly infinitesimal amounts, the real-world effects of the supply discrepancy are negligible. Moreover, Bitcoin uses the longstanding SHA-256 algorithm, while Litecoin is built on a relatively new algorithm called Scrypt. Scrypt-based digital currencies tend to be more accessible to miners.

Price Prediction

The crypto cognoscenti are bullish on the potential of Litecoin to hit new heights this year and beyond. Perhaps the most pertinent factor is its inclusion on Paypal (NASDAQ:PYPL) “Checkout with Crypto” feature. As a result, users in the United States can use LTC to conduct online transactions.

The top websites covering digital currencies are largely bullish on LTC. Coinpedia suggests that Litecoin could smash past the $500 barrier by the end of this year. Trading Beasts is conservative in its estimates and believes Litecoin will hover around $290 at the end of 2021. However, it could potentially reach $489 by 2024. LongForecast believes Litecoin will trade between $565 to $724 during the year and may experience a plunge in 2022. PrimeXBT also has a similar thesis, as it predicts Litecoin’s price to hit $600 this year.

Final Word on Litecoin

Litecoin is coming off an incredible year, and judging from the forecasts, it isn’t stopping anytime soon. It has some unique features which give it the edge over Bitcoin and other cryptocurrencies. Moreover, the integration with PayPal appears to be the start of several collaborations in the financial technology (fintech) sphere. The recent dip in Litecoin provides an excellent opportunity to invest in the burgeoning digital asset.

On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines

Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.


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