Litecoin is a cryptocurrency that is gaining traction, with increasing investment and industry adoption. This is leading more and more people to question if Litecoin is a good investment in 2021. When it comes to cryptocurrency, there are many to choose from. It can be difficult to decide which is the best fit for your portfolio, should you want to invest.
It is important to look at the market rankings and adoption within the market when making your choice. Each individual cryptocurrency has traits that affect how it functions within the global marketplace and how likely it is to last as a workable cryptocurrency.
Like most popular crypto coins Litecoin is a decentralized payment system that functions using blockchain technology. It was launched on GitHub on the 7th of October 2011, and became fully functional on the 13th of October 2011. This makes Litecoin a longstanding feature of the decentralized finance (Defi) market.
Like all fully decentralized cryptocurrencies, Litecoin is not subject to censorship or scrutiny by government bodies. Litecoin is an open system for anyone to join, create a wallet and be free to send currency globally. The Defi market has really taken off in recent years due to the prospect of separating from the problems of nationalized central banking. Covid-19 has also given the sector a boost as many cryptocurrencies proved more able to bounce back from the Covid-crash of early 2020 than the stock market.
Litecoin is based out of Singapore and run by its Managing Director Charlie Lee. Lee’s work with Google and Coinbase has given him the necessary tools to become a key player in the Defi sector.
Litecoin’s Relationship To Bitcoin
Litecoin was based on Bitcoin technology and was created as a fork of the core bitcoin blockchain protocol. Whilst Litecoin is a cryptocurrency in its own right, there are several major differences when compared to Bitcoin itself.
The transaction speed is a huge factor as Litecoin was created to process much faster. Litecoin can average a speed of 2.5 minutes when generating blockchain contracts compared to the estimated 10 minutes or longer needed to transact using Bitcoin. Litecoin also uses a scrypt algorithm which differs from the Bitcoin protocol.
Investors are also focusing on the scalability offered by these faster speeds, which is hoped to improve profitability in a shorter time frame. It is felt that Litecoin can benefit from having ties to Bitcoin, and profit from Bitcoin’s success while providing a faster system for daily transactions. This would make Litecoin a more effective payment system, despite Bitcoin holding at a higher value.
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Litecoin’s Position in the Defi Market
Litecoin currently holds a strong position in the Defi market due to its ties to Bitcoin and is ranked 12th by market capitalization at the time of writing. Litecoin has demonstrated market resilience as it is one of the older coins in the top market rankings. Due to its position as a soft fork of Bitcoin, Litecoin also positively benefits from Bitcoin success and market adoption by association.
Litecoin is considered to be the first top crypto coin to adopt segregated witness (SegWit) protocol which differs from Bitcoin’s original proof of work system. This improves the available transaction options and allows for larger blockchain limits which improve scalability.
Litecoin June Updates
Litecoin has gone through various modifications in a bid to improve its technology and transaction processing methods. There were some large ongoing modifications revealed in June 2021 by David Burnett who heads the Mimblewimble (MW) team.
Burkett discussed the work throughout May 2021 on the new MW blockchain protocol which was undergoing its testnet phase in October 2020. This has lead to abandoning the trialled cmake chain building system for the original libmw code.
This has streamlined the system and as they move into the auditing stage with Quarks Lab the upgrade is going well. This is good news for investors who worried that changes might destabilise the token’s value. The transparency that Burkett has with Litecoin users is also a mark in their favour as it helps users and investors assess the current trajectory of the coin within the market.
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Litecoin on Venmo
As of May 2021, Litecoin made a huge leap in terms of market adoption when it was integrated by Venmo. This increased market adoption should not only boost LTC value but should also help the coin become more stable later on down the line. Litecoin was one of for coins added to Venmo in May, alongside Bitcoin (BTC), Ethereum (ETH) and Bitcoin Cash (BCH).
This has cemented Litcoin as a crypto market frontrunner as Venmo users can now buy and sell Litecoin directly through the Venmo app for as little as $1. Venmo has also shown its faith in these cryptocurrencies by adding a dedicated information section to its website. This has videos and explanations of how to use cryptocurrency and store it on a Venmo account, clarifying the Defi market for new users.
This will boost the profile and then the performance of these crypto coins and Venmo has stated that it is backing the Cryptocurrency market going forward. Game-changing adoption like this is a strong sign that Litecoin is a solid investment to make in 2021 as market adoption should only increase from here. This is a one-month-old revelation that is likely to have big market impacts going forward.
Trading LTC to USD
Litecoin had a strong entry into the market and the resistances that it experienced were less drastic than many of its competitors. There have been bullish and bearish trading cycles seen over the past few years rather than the stagnant sideways trading patterns that many coins have endured. LTC has achieved several peaks throughout its lifetime, however the most recent was also the highest surge by far for this altcoin.
The strong upward trend began in November 2020 and led to a bullish market going into 2021. The first five months of 2021 were excellent for Litecoin as it went from strength to strength. Each peak was followed by a moderate correction which allowed the coin price to keep climbing throughout the year without any notable setbacks. The two main peaks occurred in April and May 2021 where an all-time high of $413.69 was achieved. This was a huge jump from the price of $125 at the beginning of 2021.
This exceptional growth has provided excellent returns for investors who bought in early 2021 or previously. However, the correction which followed was a large one, dropping to $143.43 by the 24th of May 2021. The coin is beginning to recover but this has been a slow process so far. However, this has given an opportunity for cheaper investments to be made. By buying in 2021 at Litecoin’s low point, there could be great profits to be made during the next surge for those willing to wait.
Will Litecoin Rebound from the Last Correction?
The last correction in May 2021 was undoubtedly a major one, as LTC dropped by 332% in the space of two weeks. This was a huge blow for Litcoin after having an amazingly bullish year in 2021 up to this point. Large peaks have led to strong corrections elsewhere in the sector, so it is not surprising that LTC suffered a drop and hit a bearish period, as this has been common across the Defi sector in May 2021.
The first half of 2021 was extremely bullish but the summer has brought a bearish period. Litecoin is a fork of Bitcoin and with this link, it is not surprising that like Bitcoin, Litecoin has seen large losses at this point. However, as bitcoin is starting to recover it then makes sense that Litecoin will also bounce back as the market shifts in a more bullish direction again.
Although the next peak is likely to be subjected to the delays that are being seen across the crypto market at the current time, the cycles should pick up again. For those looking to capitalize on the scale of the drop, 2021 would be a good time to invest, while many cryptocurrencies are waiting for the Defi sector to recover from this current bear market.
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Predictions for Litecoin in 2021 and the Future
Litecoin is still reeling from its recent correction after achieving its all-time high of $413.69, which shows the coin’s potential. This is substantial progress for an altcoin to make given the low values that most are still operating at. Although Litecoin is currently 12th with a market cap of 11.96B the company’s focus on scalability means that there is still a lot of potential for future growth.
Even though the current prices are comparatively low, they are still performing decently when examined within the crypto market as a whole. The surges that have occurred have demonstrated what Litecoin is capable of once a bull market takes hold.
The volatility of cryptocurrencies makes them very difficult to predict, which is a necessary factor to consider before investing. However, the lower points in the trading cycle are packed with investment potential. This point in 2021 is a good time to invest if your timeline is flexible.
The next surge can not be pinpointed, but it stands to reason that Litecoin will pick up again given the recent developments. Venmo has now added Litecoin and three other coins to their app. This along with the increasing market adoption across other areas of the business sector should cause Litecoin to rebound. After this rebound, Litecoin should then begin to experience further surges either towards the end of 2021 or over the next couple of years.
Litecoin Trading Forecast for 2021
The recent downward trajectory has been a difficult time for Litecoin particularly given the continued bear market occurring currently. But even with the dramatic drop, 2021 has still been a positive year for LTC. This year to date has seen returns of $42.41% which is small given the previous high, but still moving in the right direction overall.
It is unclear how quickly Litecoin will achieve another surge which is frustrating news for swing traders looking to capitalize quickly. The market adoption factor supports a relatively fast turnaround for LTC. Litecoin’s official Twitter account has been publicising the move by Paypal and its offshoot Venmo into the crypto market:
Founder Charlie Lee is also posting positively about the upgrades taking place at the moment which aim to improve Litecoin’s fungibility:
‘Fungibility is the only property of sound money that is missing from Bitcoin & Litecoin. Now that the scaling debate is behind us, the next battleground will be on fungibility and privacy.
I am now focused on making Litecoin more fungible by adding Confidential Transactions.’
@SatoshiLee (Twitter account of Charlie Lee, Founder of Litecoin)
This would be a huge step for Litecoin and potentially cause the next big surge once the upgrades go live.
However, some experts are predicting that the LTC price could dip further before things pick up again. This is not likely to be a large dip and Litecoin should then rebound, but this may not occur for a few months, or possibly until 2022.
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Who is behind Litecoin?
Litecoin is run by Charlie Lee who previously worked at Google. Lee later became Coinbase’s Engineering Director, which made him even more of a central figure in the Defi sector. Lee eventually left that position due to the demands of being Managing Director of the Litecoin Foundation.
What is Litecoin?
Litecoin is a peer-to-peer blockchain system that uses proof of work protocols to make fast and flexible payments and transactions. The native coin LTC can be bought and sold as an asset and swing traded to profit from the volatility of the cryptocurrency market.
How does Litecoin compare to Bitcoin?
Litecoin gets its name from its claims to be over four times quicker than Bitcoin and therefore less slow and ‘heavy’. This fast transaction speed is partly due to the differing mechanisms for using blockchain technology as Litecoin uses scrypt algorithms.
As Litecoin undergoes upgrades it becomes less similar to Bitcoin and is introducing consensus methods of verification which increase transaction speeds. Litecoin is a soft fork of the Bitcoin protocol but the similarities this caused are becoming fewer with each upgrade to improve Litecoin’s fungibility and scalability.
Should I invest in Litecoin in 2021?
Litecoin is a good investment in 2021 for those who are looking for a medium-term addition to their portfolio. This immediate outlook is unimpressive but the longer timeline from this current low point is positive and should yield good returns either late in 2021 or later on in 2022. Buying LTC at a lower price point leaves more room for higher percentage returns once the market picks up again.
Is Litecoin still going to go up?
Litecoin is likely to go up from its price of $176 at the time of writing. Although some experts feel that it will still dip slightly from its current position, the next bull market should see comparable surges to the last one in May 2021. If the increased market adoption improves Litecoin’s market position then the upward trajectory could be even more dramatic.
What will LTC prices rise to in 2021?
Some experts are predicting that LTC could rise by 30% by the end of 2021. Predictions are showing slow improvement in 2021 before greater gains are made in 2022 onwards.