What Is Litecoin?
When people still ask me, “What is Litecoin?” I’m surprised because the growth of Litecoin applications has been so spectacular this year, one would assume it’s a household name by now.
Litecoin is a cryptocurrency—an Internet currency that enables a person to conduct an almost-instant and almost-free financial transaction with another person, anywhere in the world. In fact, with the Litecoin market cap at near $5.36 billion, it is one of the top 10 cryptocurrencies on the market. (Source: “Litecoin,” CoinMarketCap, last accessed December 4, 2017.)
What Is Litecoin’s Intrinsic Value?
One question that seems to have no real answer is, “What is Litecoin’s intrinsic value?” The intrinsic value of Litecoin comes from the fact that it can be used in exchange for different products and services. Currently, Litecoin is accepted in a few select places in exchange for goods and services. As more retailers start accepting this cryptocurrency, the Litecoin value is bound to increase.
Litecoin Value for Businesses
In general, cryptocurrencies like Litecoin offer very good opportunities for business purposes. The reason many businessmen like to use cryptocurrencies is that (a) they don’t need to worry about currency exchange rates, (b) they pay fewer processing fees than they do with credit cards, and (c) transactions across the globe can be completed within minutes.
In addition to the above clear benefits, there is also the ability to conduct business with little or no government interference.
Having said that, until more and more businesspeople and retailers adopt and accept Litecoins, the value of Litecoin for businesses will be under scrutiny. To make matters worse, Litecoin is far behind Bitcoin in terms of popularity.
But as Litecoin is cheaper and faster, businesses should and will definitely be considering Litecoin as a viable option. But they should be ready to set up for another cryptocurrency as Bitcoin and Litecoin don’t use the same blockchain.
Litecoin Value for Individual Users
While discussing the intrinsic value of Litecoin, we’d mentioned some of the products and services that can be purchased with Litecoin, but as the retailers are few and far between, it is still work in progress. A recent visit by Charlie Lee (the developer of Litecoin) to China and his interaction with the media there has given rise to rumors of Amazon.com, Inc. (NASDAQ:AMZN) and even Uber Technologies, Inc. considering accepting Litecoin. If these deals come through, they will greatly increase the value of Litecoin for individual users.
The biggest of Litecoin’s limitations is that it is seen as a clone of Bitcoin. It does not have a strong identity of its own. And because Bitcoin has the first-mover advantage, by over five years, Litecoin is always playing catch-up. If one compares the “Litecoin Block Explorer” to the “Bitcoin Block Explorer,” the difference is pretty evident.
The other limitation is that like Bitcoin, Litecoin has a supply cap. Once there are 84-million Litecoins in circulation, there can be no more.
These limitations might have had an effect on Litecoin’s growth in the past few years, but this year, thanks to the Litecoin SegWit adoption, Litecoin is back, and how!
Who Accepts Litecoin? Top Businesses to Spend Your LTC
The cryptocurrency wave is coming like a tide, sweeping aside naysayers by the bucketload. And as more and more businesses adopt Litecoin, the question, “Who accepts Litecoin?” is soon to sound as silly as “Who eats chicken wings?” This rapid adoption will no doubt provide you with more options on how to spend your Litecoin. It will also increase the uses of Litecoin. Here are five top businesses that accept Litecoins currently. (Source: “Top 5 businesses that accept Litecoin payments,” HolyTransaction’s Blog, May 19, 2017.)
Benz and Beamer
This luxury car auto dealership, in Orange County, California, recently sold a “Tesla Model P85” in exchange for Litecoins. The customer paid 5,447 Litecoins as an equivalent for the $90,000 the car was worth. Naresh Shah from the Tesla dealership confirmed that the entire transaction was smoothly processed by GoCoin. According to Mr. Shah, the GoCoin platform secures the coin exchange for cash within minutes, making it easy to make the sale and get new customers.
The Tesla purchase for 5447 Litecoins is by far the largest single transaction using Litecoins.
On the other side of the globe, Ellenet, an Australian IT solutions provider that specializes in multimedia and film and production, is the first company from down under to accept Litecoin.
Estelle Asmodelle, the company’s director, made the decision to welcome Litecoin payments. In her own words, “Cryptocurrencies are the future… you can’t stop progress.” (Source: Ibid.)
With the adoption of Litecoin digital payments, the consultation firm that has been growing steadily since 1998 hopes to grow even larger.
A big advantage that Ellenet has is that it also works with digital mining company Petabit Pty. Ltd, which mines both Litecoins and bitcoins. The partnership with Petabit will help Ellenet get into more digital currency-based ventures.
Although it’s not strictly a business per se, this homeless outreach center in Pensacola makes it onto this list because it is one of the early charitable organizations that allow digital currencies like Litecoin to help the local community. This Florida-based center has earned a reputation for providing thousands of meals to those below the poverty line. And now it aims to take the good work further with the help of donations in the form of Litecoin and other cryptocurrencies.
This gift-giving site based out of the Big Apple has teamed up with GoCoin to facilitate Litecoin transactions in April 2014. The site allows people to earn points while buying and sending gift cards to one another. The move to take in Litecoin was done in an effort to ramp up the business by reaching out to new and interested customer bases. Tyler Roye, the CEO, is confident that with Litecoin (and other cryptocurrencies) and GoCoin, he can hope to keep the site secure and fraud-free. But instead of holding on to the coins, the business converts the digital earnings into cash.
This mining hardware company is related to cryptocurrencies, so it only makes sense to promote cryptocurrencies. The company not only allows coin enthusiasts an opportunity to earn Litecoins, but it allows mining hardware to be purchased with those same coins.
It’s interesting to note that the demand for digital currencies and miners has been so high that KnCMiner sold $2.0 million worth of pre-ordered hardware within just a four-hour window.
Being an analyst, people always ask me what the Litecoin future value will be or if the LTC potential value will go up. I simply reply that Litecoin is the future.
To support my argument, let us take a look at that Tesla sale.
The dealer actually incurred a loss at the time of the sale (first week of April). At that time, the value of Litecoin was $11.62. In effect, the dealer sold a car worth $90,000 for just $65,000. Today, less than eight months later, the value of Litecoin is near $92.00. Do the math. The dealer has $501,124 to his credit and one fewer Tesla. In effect, the dealer is richer by $436,124. That’s more than the cost of four Teslas.
And as news filters out and more and more businesses get the Litecoin bug, there will be an epidemic of sorts. The future for Litecoin is bright. Very bright!