Going short and long on Litecoin CFDs

It is an open-source digital currency that is known as the zero peer-to-peer cost and instant payments around the world. It was launched in 2011 and holds the number 5 in the market. Litecoin has a strong blockchain network that can control higher transactions. These transactions are controlled due to block, and there is no need to modify the software. This results in instant payment confirmation. 

Why trading Litecoin (LTC)?

Litecoin is among the top cryptocurrency and rapidly gaining importance. It is also considered a competitor to Bitcoin. Moreover, an investor can trade on Litecoin without holding it and can earn profit by the rise or fall of the market. Here we discuss some reasons to trade Litecoin.

  • As it is a digital currency and a derivative product so there are no chances of being stolen. Investor’s profit is based on the Litecoin price movement.
  • There is no need for any approval to join the trading of Litecoin.
  • Litecoin enables the instant worldwide arrangements of funds and Atomic Swaps.
  • It has the largest worldwide scrypt based network blockchain. The blockchain network is operating since 2011 transacting and securing billions of dollars.
 
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Advantages:

The advantages of trading Litecoin are discussed below:

  • Trading CFD on Litecoin is instant, remove slippage and other issues.
  • Investors can trade Litecoin by buying (go long) or selling (go down).
  • Litecoin has a new scrypt algorithm which has significantly increased the transaction speed.
  • Litecoin gives complete anonymity of transactions.
  • Litecoin does not take any external influence as it has a decentralized principle.
  • It is easy to trade for both buyer and seller.

Disadvantages:

As everything has some drawbacks, so has Litecoin some disadvantages.

  • The main disadvantage is poor circulation rules and uncertainty of status. There is no legislation.
  • There are chances of high earnings in the fluctuation of rates. But due to high volatility, there are chances of big loose.
  • The bad news about the financial market can significantly change the price of Litecoin. There are high chances of bad news effect on the cryptocurrency.
  • The mining process of Litecoin is too centralized. Litecoin mining machine was introduced at the start of the last year.

How to Trade LTC?

Here we will discuss how to trade Litecoin on different trading platforms:

AvaTrade

  • Open a trading account on the AvaTrade platform.
  • Deposit funds in an account via credit cards, e-payments methods (WebMoney, Skrill, etc.), and wire transfer.
  • Select Litecoin on the platform and invest the desired amount for trading

IQ Option

  • Open a trading account on the IQ option platform.
  • Deposit funds in an account via Master cards, VISA, e-payments methods (WebMoney, Skrill, etc.), and many more.
  • Select Litecoin on the platform and invest the desired amount for trading

Plus500

  • Open a trading account on the Plus500 platform.
  • Deposit funds in an account via fiat money and cryptocurrency methods.
  • Select Litecoin on the platform and invest the desired amount for trading

Where to buy LTC:

Litecoin can be bought from the exchanges are listed below:

  • Coinbase
  • Robinhood
  • Binance
  • Square Cash
  • Coinmama

Things to consider before trading with Litecoin

What is Litecoin?

The Litecoin blockchain is one of the oldest and largest in the world. It is the 1st decentralized cryptocurrency, designed to be globally accessible and highly accessible to people of all ages. The Litecoin blockchain has no central server, rather, it is stored on distributed ledgers across many global computers. The Litecoin network has roughly 64,000 Litecoin nodes, compared to the roughly 10,000.00 currently operating on the Bitcoin network. Therefore, as the network expands, the number of nodes will only become more efficient as Litecoin becomes widely adopted.

The Litecoin blockchain was designed to be faster and more efficient, so that its transactions are confirmed faster. Litecoin does not have any pre-mined coins, unlike Bitcoin. Instead, its software generates a set of new coins called Litecoins every 2,000 blocks (3,440 minutes, 10 minutes, or 5.6 years). A block is a record of recent transaction, including both the senders name, the amount and the date. As with Bitcoin, it is important to remember that Litecoin has a fixed supply and that coins will be destroyed at an annual inflation rate of 4.5%. This is because, as with Bitcoin, the mining of new coins is extremely expensive, so the more coins you add, the more expensive mining becomes.

Litecoins very high transaction fees make it one of the most expensive cryptocurrencies. As such, it is not suitable as a store of value, as its use as a medium of exchange is restricted to people who want to buy small amounts of value (especially on exchanges).

What is a Litecoin ICO?

Litecoins ICO is a digital, token offering that aims to help raise the money that would be needed to develop the blockchain and build out the ecosystem. At the time of writing, the limit is set at 75 million tokens. The digital token is tradable on several exchanges, such as Bittrex, OKEx, Yunbi and more. The Litecoin token is limited in that it has an intrinsic value of 100 litecoins. Although it is not easy to get hold of the tokens, you can purchase them from resellers such as Bittrex, OKEx, Yunbi and more.

Investors in the Litecoin ICO will be able to invest via crowdfunding through an initial coin offering (ICO). This is a crowd funding process, where a company announces that it is launching an innovative new product, service or concept. In the case of Litecoin, the announcement of the ICO came shortly before the launch of the first Litecoin silver cryptocurrency, LTCUSD. The objective of an ICO is to attract wider investor participation and capitalise on that in order to grow the projects value. In particular, in this case, investors will be able to invest in the Litecoin ICO as part of a fundamentals bundle through which they will benefit from fast and secure delivery of their investment.

Like Bitcoin, Litecoin was designed to be a widely adopted digital currency. However, unlike Bitcoin, the limit of coins will expire at some point, in 2024.

What is the difference between Bitcoin and Litecoin?

Bitcoin is a peer-to-peer payment system’s network, meaning that unlike the official banks of the world, it is not subject to the current whims of governments or central bankers. Its usage is entirely unregulated. Litecoin is often referred to as the silver to Bitcoins gold, in that its faster and cheaper to acquire, but it is unable to easily acquire the value that can be generated by larger, more established Bitcoin companies.

Both Bitcoin and Litecoin were designed to solve the distributed, decentralized nature of the Bitcoin network, and both achieved this by adopting a proof-of-work algorithm (in Litecoins case, a hash algorithm) that is designed to make it more difficult for an individual to centrally control the emission of new coins. Litecoin was specifically designed to make it more difficult to issue new coins as a result.

In essence, the effect of this algorithm is to make it more difficult for anyone but the first miner of a block (and, in theory, subsequent blocks) to derive new coins. Because the systems protocol does not support a very high maximum supply, it can be expected that even with a limited supply, it will be nearly impossible to accumulate large numbers of coins.

Unlike Bitcoin, the Litecoin networks blockchain (the public ledger of all transactions) does not have a limited size. The maximum number of coins ever created by the network is 84 million m​​​​​​​Litecoin, making it 20 times larger than Bitcoin.

The difference in the way that Litecoins blocks are generated is also important. The miners of Litecoin can easily modify their computers to create many fewer blocks than would be the case with Bitcoin, to increase the efficiency of processing incoming transactions.

How does Litecoin work?

Litecoin is a cryptocurrency similar to Bitcoin in its basic structure, but it is designed to be easier to use. As with other cryptocurrencies, users send funds from their Litecoin wallets to others by means of an open-source digital wallet service called a cryptocurrency exchange. The payment is made in the currency that the users computer is trading on, using algorithms that cryptographically guess how much of the currency being traded is being sent to whom.

 
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How is Litecoin traded?

In the simplest terms, a cryptocurrency exchange operator charges a fee that is either posted to the customers Litecoin wallet or, in some cases, deducted from the customers payment. In most cases, the transaction fee is much lower than the trading price, and in some cases it is zero. If the cryptocurrency being bought is expected to increase in value, the exchange operator will charge an increase in the price for this.

The margin that the customer may choose in these situations is open to be adjusted and actively managed, as this is considered a fair and prudent trading practice. The margin will vary from exchange to exchange, of course, but always in line with the bid-ask spread (discussed below) as determined by the volume and value of the trade.

The principle of regulation lies with the state. Coinbase exchanges a cryptocurrency into fiat currency. The US Federal Reserve has issued guidelines on such exchanges that governs how they can operate, while state regulatory authorities either have their own guidance on cryptocurrencies or openly refuse to offer any guidance whatsoever.

Bitcoin has a patchwork of different regulations and laws governing its operation. There is no such thing as an unregulated cryptocurrency and there is even no standard, universally agreed upon tax code that governs cryptocurrency. Despite this, there are some countries in Europe that recognize it as legal tender, in part because they have laws on the books allowing for that.

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