How to Buy Litecoin (LTC) Currency?
In January of 2017, the price of Litecoin was just $3.75 and things were not looking good for the cryptocurrency once touted to be the rival to Bitcoin. A few months later, Litecoin upgraded to the Segregated Witness system (SegWit) to boost its speed and capacity. Since then, there has been no looking back; Litecoin has hit record highs, currently trading near $90.61 and rallying more than 5,200% since the start of the year. With the Litecoin market cap at around $4.89 billion, it’s not surprising investors are lining up to learn how to buy Litecoin. Here’s how…
- Get a Wallet – This is very important as you’ll need a safe place to store your Litecoins after you buy them. You can choose between desktop wallets, mobile wallets, or hardware wallets.
- Select an Exchange to Create Your Account – Like most cryptocurrencies, Litecoin needs an online exchange for trading. Some of the best places to buy Litecoin are Coinbase, Bitpanda, Changelly, Shapeshift, and Poloniex. While all of them are reputed, choose one based on your needs.
- Go Through the Verification Process – Most reputed exchanges will ask you to upload some documents to verify your identity. The more popular the exchange, the more time needed for verification.
- Deposit Regular Currency – All you need to do is deposit dollars, euros, or another major currency into your newly created account. It could take a few days for your money to be cleared.
- Begin Trading – Once your money is deposited into your account, you can begin purchasing Litecoins or trading them for fiat currency or other cryptocurrencies.
- Withdraw LTC into a Wallet – After you buy Litecoins, make sure you withdraw them into your own wallet to prevent them from being stolen online. This completes the buying cycle.
How Does the Litecoin Price Get Value and Why Is It Lower Than Bitcoin?
Like other altcoins, (alternative cryptocurrencies) Litecoin’s value is hugely linked to that of Bitcoin. If the value of Bitcoin rises, the value of Litecoin will rise shortly after. And if the value of Bitcoin falls, the value of Litecoin too goes south. As cryptocurrencies are very volatile, you can expect the value of Litecoin to register dramatic fluctuations.
Of course, there are other factors that determine the value of Litecoin. As we have seen, Litecoin’s upgrade to SegWit boosted its value astronomically. Other upgrades that Litecoin has in the pipeline will also have a huge effect on its value.
Having said that, the value of Litecoin is nowhere close to Bitcoin. The biggest factor for Bitcoin’s high value is the fact that Bitcoin has the first-mover advantage. It had a lot of time to woo investors and win over the market, long before Litecoin came on to the cryptocurrency scene.
The other reason for the low value is that the Litecoin mining algorithm is less dependent on electricity than that of Bitcoin. This can lead to lower costs for miners.
The current low value of Litecoin is actually proving to be a blessing in disguise as it keeps Litecoin and the fees to trade Litecoin on exchanges well within the reach of new investors. And talking of exchanges, price is just one of the factors to select best LTC exchanges.
How to Select Best LTC Exchanges
As there are so many exchanges that support Litecoin, a new trader can find it difficult to choose which one to use. The list below will give an idea of what to keep in mind when selecting a Litecoin exchange.
Basic Exchange Info: It’s good to know things like the name of the founder, location of the exchange, and the market it focuses on. It makes sense to select exchanges whose owners are not anonymous and can be researched, like Mr. D’Agosta of Poloniex, for example.
The location of the exchange is important too because every country has a different set of laws regarding cryptocurrencies. Though some countries don’t have any laws related to digital currency yet, once the laws come into effect, they could affect the trade.
Supported Currencies and Liquidity: It’s important for the trader to ensure the exchange not only trades in Litecoin but supports the trading pairs the trader is interested in. For example, if the trader is interested in trading Litecoin for ETH, the exchange should support the LTC/ETH pairing.
To further narrow down the options, check the exchange’s liquidity for select pairings and select the exchange with the highest liquidity (highest trading volume).
Ease of Use: This is self-explanatory. Choose exchanges that have friendly user interfaces, quick loading times, and yes, support for mobile devices.
Trading Fees: Trading Litecoins costs money. Usually, exchanges charge a small percentage of the amount traded. In some exchanges, this percentage usually decreases with an increase in monthly trading volume. These are the exchanges you should hone in on as the decrease in percentages can save you a lot of money as you start trading more.
Customer Support: As cryptocurrency exchanges are an evolving technology, many new traders can be clueless about the simplest of processes. An experienced customer support team can save a lot of time and money.
User Experience: There is something to be said for learning from other people’s experiences. Check Litecoin blogs and forums to figure out the best LTC exchanges, and which exchanges are highly recommended. Needless to say, the best Litecoin exchange reviews are the ones with the least complaints.
Security: Are Litecoin exchanges safe? Trading on the various exchanges exposes the trader to a certain amount of risk to hacker’s attacks. Though safety is last on this list, it is as important as any of the other factors, if not more.
Traders selecting their exchange based on the above parameters should ideally end up with the best Litecoin exchanges to suit their needs. And more often than not, the best LTC exchanges will turn out to be one of the following five exchanges.
Best Exchanges and Reviews to Buy & Sell Litecoin Instantly
While the choice of Litecoin exchange will depend on individual needs, some exchanges have earned themselves a reputation for their ability to facilitate fast buying and selling of Litecoin. Here are the top five exchanges to buy Litecoin along with a Litecoin exchange comparison chart for quick reference. (Source: “Buy Litecoin,” Buy Bitcoin Worldwide, November 27, 2017.)
This is the easily the most popular exchange for buying and selling Litecoin. Coinbase is a U.S.-based exchange that supports the purchase of Litecoin with credit/debit cards that are 3D secure. For its services, Coinbase charges a standard 3.99% of the transacted amount on all debit/credit card trades.
High transaction limits
Instant buying facility with debit/credit cards
Slow bank transfer purchases
Transactions may be tracked
This popular exchange based out of San Francisco is one of the largest exchanges in the world. Though it is based out of the U.S., it has a huge presence in Europe and Japan. This exchange is ideal for professional traders who trade on a daily basis. The biggest drawback with Kraken is that it does not support credit/debit cards. You can trade with USD, JPY, CAD, GBP, and EUR by wire transfer or SEPA.
Low taker and maker fees
High liquidity and security of assets
Regularly posts proof of stored assets
Master key for account recovery
Two-factor authentication adds extra security
Hard for new users
Not private / Requires an identity card
Does not support credit/debit cards
This is a great exchange especially in countries where Coinbase and Kraken are not available. Changelly is available in almost all the countries in the world for credit/debit transactions or for trading with other cryptocurrencies. Changelly accepts any currency of any country and calculates its USD equivalent. All transactions are done based on the USD value.
Available in almost all countries
Easy to use
Rates are high
Requires an email address
This popular exchange lets you trade securely with the advanced trading processes. Operational since early 2014, this exchange supports Litecoin and more than a hundred other cryptocurrencies. This exchange has the highest known liquidity rates for cryptocurrencies. The good thing about Poloniex is that it monitors all activities around-the-clock and if any suspicious activity is found, then it immediately puts an active block into place.
Facilitates margin trading
May not be easy for new users
Had been hacked once in 2014
Has limited Litecoin pairings
This is the world’s largest Bitcoin exchange by BTC volume but it also supports Litecoin and other major cryptocurrencies. Traders can buy Litecoins in exchange for BTC or USD from Bitfinex.
There will be a wire fee of at least $20.00 plus a trade fee (0.1% to 0.8%) for these currencies (including LTC) in exchange for BTC or USD from Bitfinex. In addition to this, there is a varying deposit/withdrawal fee.
Trade-on-the-go with mobile apps
One of the world’s largest exchanges
Currently does not allow U.S. customers
Litecoin Exchange Comparison Chart
Reasons to Trade Litecoin
Should you trade Litecoin—currently in top ten in the list of cryptocurrencies by market cap—or should you look at some of the other cryptocurrencies higher up in the pecking order? This is a good question, especially since one of the cryptocurrencies in the top five is trading for pennies.
Well, to be perfectly honest, the way the cryptocurrency market is growing, all these currencies make for great investments. It all depends on the individual trader. The thing to remember is that while some of the other players have surged only recently, Litecoin has consistently been one of the top cryptocurrencies over the last five years and therefore has a proven record. Having gone through up and downs, it is on a rapid upward curve right now.
Also, as Litecoin is more liquid and lot cheaper than Bitcoin and Ethereum, acquiring it is easier and you can get a lot more for your money, allowing you to benefit more from any big spikes in value.
Litecoin’s similarity to Bitcoin also means that if Bitcoin is taken up by major merchants as a payment method then Litecoin is similar enough that it may also be considered as a payment choice.
If I were a newcomer, I’d stick to Coinbase as it has the best user experience and is one of the least expensive exchanges to operate on. For more experienced traders, I’d recommend Kraken, even though it does not support credit/debit cards. But for both novices and professionals, I’d recommend withdrawing your Litecoins into offline wallets immediately.