Ethereum is not the only cryptocurrency experiencing skyrocketing prices. Prices of the sixth largest cryptocurrency LiteCoin are also going through the roof.
Litecoin prices rose by 70% on March 30, 2017, going from $4.18 to $7.04 a piece in just a few hours. The price is far from Litecoin’s all-time high of $48 each reached in 2013, but it was impressive enough to ignite speculation that the digital money might become the next ethereum.
Ethereum has been experiencing a bull market for several weeks. Its price has gone from $10.71 on February 1, 2017, to $52.46 on March 30, 2017, Coinbase data indicates.
There are several theories about ethereum’s rise floating around; including volatility in the bitcoin market, fears that the Chinese government is about to crackdown on bitcoin and increased interest in cryptocurrencies because of bitcoin’s recent performance. Not surprisingly some investors are beginning to wonder if Litecoin will become the new ethereum.
Is Litecoin the New Ethereum?
There are some similarities between ethereum and litecoin both are attempts to create a globally decentralized cryptocurrency. Both currencies also aim to be more respectable alternatives to bitcoin.
Most intriguingly both solutions are open-sourced products. Ethereum is based on the popular open-sourced operating system Linux. Litecoin is built on the MIT/X11 license which gives anybody the ability to modify, distribute and copy it.
Another similarity is that both Litecoin and ethereum offer far more transparency than bitcoin. We know the names of the creators of both, Vitalik Buterin co-created ethereum, and former Google employee Charles Lee launched Litecoin.
The similarity to ethereum might account for the growth in Litecoin’s prices. A strong possibility is that investors and speculators are looking for a more sophisticated cryptocurrency than bitcoin. A good case can be made that both Litecoin and ethereum are better and more sophisticated payment solutions than bitcoin.
Is Coinbase Responsible for the Litecoin Boom?
Another cause of the Litecoin price increase might be the highly respected U.S. trading and digital wallet solution: Coinbase. Coinbase became the first business to receive a license to trade litecoin in New York State on March 23, Coin Desk reported.
Since Coinbase also got a license to trade ethereum in the state at the same time, the possibility is a strong one. The Empire State even gave the cryptocurrencies some free publicity in the form of a statement from Maria Vullo, the Superintendent of its Department of Financial Services (DFS).
“DFS has proven that the state regulatory system is the best way to supervise and cultivate a thriving fintech industry, like virtual currency,” Vullo said. “New York will remain steadfast in pushing back against federal encroachment efforts like the OCC’s (Office of the Comptroller of the Currency) proposal to impose a one-size-fits-all national bank charter that increases risk and seeks to usurp state sovereignty.”
Coinbase’s action demonstrates the similarities between litecoin and ethereum. It and DFS’s approval demonstrate the utility and safety of both products to investors. This indicates that litecoin’s prices like ethereum’s should experience significant growth for at least the next few weeks.
Litecoin might soon establish itself as a viable alternative to both ethereum and bitcoin.