Introduction
Almost similar to Bitcoin in terms of technical details, Litecoin is an open-source software, peer-to-peer cryptocurrency that is becoming a popular investment instrument among traders nowadays. This section will tell you everything you need about trading Litecoin on eToro.
77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
But First, What is Litecoin?
Launched in 2011 by Charlie Lee, the former Google and Coinbase Engineer, Litecoin is patterned after the Bitcoin codebase but with key modifications such as higher supply, and an improved processing speed that added new blocks to its blockchain. It is often referred to as cryptocurrency's "digital silver" to Bitcoin's “digital gold”.
Decentralized and free from censorship, Litecoin is a peer-to-peer, and an open-source software cryptocurrency that processes a block every 2.5 minutes (Bitcoin processes a block for 10 minutes).
Simply say: Litecoin is a fork of Bitcoin.
Difference Between Bitcoin and Litecoin
Despite the many technical similarities shared by Bitcoin and Litecoin, it still differs in many aspects to each other. Here are some key differences between Bitcoin and Litecoin.
- Bitcoin has a bigger market cap of $1 trillion, while Litecoin’s own market cap is estimated at $13.8 billion.
- Litecoin's transaction speed is faster and produces more coins than Bitcoin.
- Litecoin is using Scrypt, an algorithm that is more recently developed. Bitcoin uses the old SHA-256 algorithm.
- Litecoin has a coin limit of 84 million as compared to Bitcoin’s 21 million.
How Does Litecoin Work?
Litecoin works by requiring the development and transfer of Litecoin digital coins through an open-source and cryptographic protocol. Litecoin uses blockchain technology to record transactions.
What Is the Scrypt Algorithm That Litecoin Is Using?
An example of a password-based key derivation function, the Scrypt algorithm was developed by Litecoin creator Charles Lee to meet the requirements needed to battle large-scale hacker attacks on the world of cryptocurrency.
Litecoin Mining Reward
Litecoin minders are rewarded with 12.5 LTC coins per block. This among is halved every four years or every 840,000 blocks.
The Litecoin network is aiming to produce 84 million Litecoins, quadrupling the number of currency of Bitcoin.
But wait, what is a blockchain?
The “Blockchain” operates like a digital shared ledger where all records of Litecoin transactions are stored. When sorting transactions in cryptocurrencies, "miners" group these transactions into “blocks”.
The same “blocks” are safeguarded cryptographically before being included in the blockchain.
How to Trade Litecoin on eToro?
Given you already have a confirmed eToro account and you're interested to trade the Litecoin cryptoasset, you need to follow these simple steps:
- Open the eToro platform and key in “Litecoin” on the Search Bar. From the drop-down search results, select “LTC”.
Searching for Litecoin on the eToro platform - Click “Trade”.
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Trade button on eToro's Litecoin (LTC) page - Set the amount you want to invest.
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Buying Litecoin (LTC) on eToro's platform - Click on “Open Trade”.
Executing LTC buy order on eToro
Copy Litecoin Traders
You can also take advantage of eToro’s CopyTrader feature to imitate or copy the Litecoin trading strategies of the platform’s more seasoned, and successful traders.
By using the feature, you not only get to copy a Litecoin trader of your choice, you can also discuss Litecoin Trading strategies with them.
Trading Hours for Litecoin
With stocks, commodities, indices, currencies and ETFs, there are specific opening and closing hours to trade the instruments. The trading hours for cryptocurrencies such as Litecoin are different because it operates 24 hours, 7 days a week so it can be traded anytime on the eToro platform.
Trading Fees for Litecoin
eToro does not charge any trading fees on stocks, ETFs, commodities, indices, commodities and cryptocurrencies as well. They only charge for spreads.
Litecoin Spread
Since eToro does not charge any trading fees when you buy or trade cryptocurrencies, eToro only imposes a fee for spreads. The spread for Litecoin is 1.90%.
Litecoin Price
To view a real-time update of the price of Litecoin on your eToro app, simply follow these simple steps:
- Open the platform and on the search box, enter "Litecoin".
- Click on "LTC" from the drop-down results.
- View the current price of Litecoin.
How to View Litecoin Charts
The eToro platform is designed to show a detailed chart of any financial instrument and this includes Litecoin. The chart information shown can help you analyze the price history and market performance of Litecoin. You can use the information from the chart to formulate a trading strategy as well.
To view the real-time chart of Litecoin just follow these steps:
- Search for "Litecoin" on the search box, then click “LTC” from the drop-down result menu.
- Click “Chart”.
Candles are used by the chart by default. A green color means that LTC's value has increased while a red color indicated that the value has gone down. You have the choice of viewing these in the form of Japanese candles, Bollinger bands and Fibonacci.
Can I Lose More Than I Invest on Litecoin?
Yes, it is possible to lose more than the amount that you invested on Litecoin and other assets and this might be due to placing your entire capital, getting charged with rollover fees and/or losses that you may incur with your current trades.
But with the Negative Balance Protection feature of eToro, all of these are absorbed so your equity will simply be reset to zero and you won’t owe them a higher amount than your capital.
LTC Cross Pairs
With the eToro platform, clients can trade the LTC coin but they can also invest on various cross instruments linked to this digital currency such as crypto crosses and currency crosses. The availability of these crosses depends on their market popularity and demand.
| Currency Crosses | Crypto Crosses |
|---|---|
| Australian Dollar (LTCAUD) | Bitcoin Cash (BCHLTC) |
| Canadian Dollar (LTCCAD) | Zcash (ZECLTC) |
| Swiss Franc (LTCCHF) | |
| Euro LTCEUR) | |
| British Pound (LTCGBP) | |
| Japanese Yen (LTCJPY) | |
| New Zealand Dollar LTCNZD) |
Notice:
These crosses may not be available for trading if your account is under a regulatory body that prohibits investing in these types of cryptoassets.
If you want to know if you are restricted from investing on these crosses, check if the buy and sell buttons are disabled. If it is then you will only be able to access the pages of these crosses where you can see its market price and interact via its feed.
This pop-up warning will also appear if you clicked on the underlying asset:
Selling LTC: A Clarification
If you previously bought LTC via eToro and decided to “sell” it with the thinking “I want to SELL my Litecoins” to get your money out, then what you need to do is to “Close” it.
If this is your primary goal then follow these basic steps:
- Open the eToro platform click your portfolio. This will list all the existing assets that are open under your account.
- Look for the LTC open position that you would like to close and click on it.
- Click on the red X that is located on the right part of the open LTC position. A pop-up will appear.
- Decide on whether you want to close the entire position or just a portion of it by entering the amount or units.
- Click the "Close Trade" button to finally close the postion.
Note: This is not the same as “selling” which is a term that is defined differently in the trading world. Clicking on the “Sell” button means that you’re going to open a short position which is betting that the price of LTC will go down.
Will I Own the Litecoins That I Will Purchase?
Yes. All the Litecoins and cryptos you will buy from the eToro platform will be placed under your name. But because these digital cons cannot be owned physically, it has to be stored in a digital wallet or give authority to an entity to keep these coins you purchased under their custody.
eToro’s Litecoin Wallet
Like Bitcoin and other cryptocurrencies, Litecoin can be stored by using the digital “wallet”. After you buy Litecoin coins from an exchange, or earned it through digital mining, you can store your Litecoin in a cold storage or digital wallet in order to save and record transactions.
eToro has an online crypto wallet where existing users can store their digital coins, including LTC, securely. It can send and receive LTC and various cryptocurrencies from other external wallets. Since this is online, this is stored on eToro’s servers and not on your drive.
Transferring Litecoin to eToro
You can transfer LTC to eToro and this will be received by the eToro Wallet. Do take note that you initially need to sign-up for a wallet account, open an LTC wallet and then provide your Litecoin public address to the sender in order to receive this token.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Past performance is not an indication of future results. Trading history presented is less than 5 complete years and may not suffice as basis for investment decision.
Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro.