Litecoin was the very first altcoin, meaning it was the second cryptocurrency to come into existence after Bitcoin. It was designed to be the silver to Bitcoin’s gold. It’s a lighter, faster, and cheaper alternative to Bitcoin. But, is it still a useful and relevant token for crypto investors today?
Here we’ll look at what’s been happening with Litecoin recently, its pros and cons, and whether LTC is still a good investment, or if you should swap LTC to ETH or other newer crypto token.
Recent Market Trends to Fill You In
The crypto market had an epic 2021, reaching an all-time high in November that was more than 3x what the market had ever achieved before. Many altcoins secured much greater gains than Bitcoin.
Then, after November 2021, crypto went into a bear market caused by concern about an overheating global economy. Recovering demand after the pandemic and supply shocks caused inflation to spike, and central banks started to raise interest rates to tackle it. Higher interests are bad for tech investments such as cryptocurrencies. This bear market hit its most recent bottom on June 18, 2022. Since then, the market has seen a slow recovery.
How Does Litecoin Manage the Crypto Crisis?
Litecoin has performed in line with broader market trends. It neither gained significantly more during the bubble phase in 2021 nor crashed more than the rest of the market in 2021. It performed similarly to altcoins such as ETH, DOGE, and SOL. However, Litecoin has seen less price volatility than many other tokens in this time.
LTC hit its all-time high of $412 in May 2021. Then it hit a 2022 low of $40 in June 2022, bouncing back to about $60 as of August 2022.
Should You Invest in LTC?
Here are the advantages and drawbacks of investing in LTC.
The Pros
The three main upsides of investing in LTC are:
- It has a long track record: LTC has been around since 2011. That’s prehistoric in the crypto world. After more than 10 years, LTC is still one of the most popular and used tokens. This proves the staying-power of Litecoin and its community of users.
- Better utility compared to BTC: LTC has faster processing times, more scalability, fairer mining, and lower transaction fees than Bitcoin. This makes it better for day-to-day use.
- Simplicity compared to newer tokens: Litecoin doesn’t have the smart contracts and other next-gen technologies of the newer crypto projects like Ethereum and Solana. Nor does it want to. Litecoin is a simple cryptocurrency with a small and well-defined scope.
The Cons
The three main downsides of investing in LTC are:
- Older technology: Litecoin’s technology is very similar to Bitcoin, with just a few tweaks. This has left it vulnerable to newer cryptocurrencies with more scalable and flexible technologies. It’s unlikely that Litecoin will ever be upgraded to include smart contracts of newer consensus technologies like Proof-of-Stake.
- Falling in the rankings: Litecoin peaked at #2 in the crypto rankings when it was one of just two cryptocurrencies in existence. Since then, it has steadily fallen as newer cryptocurrencies continued to overtake it. Now, it sits at #21 in the rankings.
- Abandoned by its creator: In 2017, Litecoin creator Charlie Lee announced he had sold all of his LTC. He did this because there was obvious manipulation in the LTC market, and Lee did not want to be accused of manipulation. Leadership is important in crypto projects, so this was a big blow for LTC.
Conclusion
Litecoin, along with Bitcoin, is part of the folklore of cryptocurrencies. It was launched just a few years after Bitcoin and shares much of its technology. It’s an all-time favorite of many crypto investors and has a place in most portfolios. During the most recent crypto crash, the LTC price performed like many other altcoins, including the ETH, SOL, and ONG price. However, being one of the oldest cryptocurrencies is also a downside. It’s being overtaken by better, faster, and stronger networks.
Overall, LTC is a strong cryptocurrency that can form part of the core of a crypto investment portfolio. Eleven years on, LTC still performs its job well.
