Bitcoin Vs. Litecoin: What's The Difference?

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No matter which markets you choose, every proper investing strategy involves "the hedge. Thus, hedging helps mitigate volatility that might occur in the primary investment. This article originally appeared on Crush The Street -- https: One of the most common hedges for stock market investors is gold. Typically, as the equity markets rise, investors see little need for safe-haven assets like gold and silver.

But if equities falter, a rush to safety occurs. Gold often soaks up this capital outflow, which makes it an ideal hedge against the benchmark financial indices. But what about the cryptocurrency markets? Such vehicles are often considered a hedge against both traditional investments like index Litecoin and bitcoin relationship, and standard safe-haven assets.

But what hedges popular blockchain currencies like bitcoin or ethereum? The answer is litecoin! For the most part, blockchain coins have a strong, direct correlation with bitcoin. This simply means that as bitcoin rises, so too does other cryptocurrency assets. When bitcoin falls, it tends to take down other cryptos. And no matter how many times alternative offerings like ethereum attempt to "de-lever" themselves from bitcoin, the hard numbers don't lie.

For example, ethereum has a Popular altcoins Steem litecoin and bitcoin relationship Dash are even more directly correlated at Essentially, whenever bitcoin experiences any choppiness or volatility, many litecoin and bitcoin relationship cryptocurrency assets follow suit.

This is particularly unfortunate when bitcoin runs into its own unique, fundamental challenges. For example, the scaling issue which threatened a softfork was a bitcoin-centric problem. Yet it negatively impacted so many cryptos that had nothing to do with scalability.

A notable exception is litecoin. It may respond to the king of cryptos' movements, or it may not. As we have seen throughout June and most of July, litecoin is independent of bitcoin. For those seeking a hedge within the blockchain markets, litecoin is an astute choice. While other coins were tanking under a litecoin and bitcoin relationship threat that didn't directly involve them, litecoin trading remained comparatively robust.

Thank you for sharing this post. I'm a big Litecoin and bitcoin relationship fan. Not only do I own litecoin in my crypto portfolio, I am also mining litecoin to hedge against any unforeseen bitcoin or eth conditions. You have a point: Litecoin price is relatively independent of Bitcoin price compared to other cryptos and it has its own upside potential. Ideally, litecoin and bitcoin relationship choosing a hedge you would actually want something with a negative correlation to bitcoin price.

Thus, while I agree litecoin and bitcoin relationship if you're looking for a hedge within the blockchain market, Litecoin may be one of the better options, currently traditional currencies are probably still the safer option or currency-based tokens, if you want the best of both worlds and are willing to take a slightly bigger risk. But if you wanted to stay within the cryptocurrency markets, I think litecoin gives you the best shot among the majors.

Further research may or may not make that point stronger, as I'm admittedly only looking at trailing month I will keep you all litecoin and bitcoin relationship Thanks for sharing and you got my vote: Thanks, great information to consider.

Interesting, is there any known reason to the reduced risk of litecoin correlation to Bitcoin? Not that I know off-hand. I'll have to explore other metrics to see if I can narrow down an explanation. My guess is more robust sentiment and litecoin and bitcoin relationship more favorable transaction fees. Good to see I'm not the only one who thinks like this.

Buy and hold for the litecoin and bitcoin relationship 3 years and the blockchain market will find it's way. I was researching a way to find more info about the current cryptocoins on the market. But I have mined some because was easy to do on simple PC. I was not surprised that price is not going up in begin but today I see Litecoin as competitor to Bitcoin. Yup, Ripple surprised me as well. It's an area where I will dig deeper I've been wondering what cryptocoin might be a good hedge.

But looks like LTC has weathered the storm and is continuing to move forward. I like LTC in that it was the first to adopt Segwit and it has a good team. Appreciate your information here. Looks like I need to give LTC one litecoin and bitcoin relationship look! It gives you litecoin and bitcoin relationship nice hedging platform within the cryptocurrency markets! Litecoin is the Perfect Cryptocurrency Hedge! Moving forward, investors should consider this "de-levered" attribute of litecoin.

It's a perfect risk mitigation vehicle, and better yet, it has its own tremendous upside potential! Authors get paid when people like you upvote their post. If it was possible to resteem comments, I would resteem yours! Folks, this is how you properly debate!! Thanks for your kind reply! Looking forward to your follow-up! God knows I can use as many votes as I can get! Great article, I found it very informative. Keep up the hard work.

I'd include Monero too:

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Cryptocurrency is still relatively unexplored by the majority of consumers. This got me thinking, what kind of analysis could be done by studying the relationship between gold and silver and applying it to Bitcoin and Litecoin? Is it fair to compare cryptos to precious metals?

If we do make the comparison, how we can apply our knowledge of the precious metals market to cryptocurrency? The analysis that follows is not meant to be a sure way to predict price, it is intended to be an intellectual exercise, exploring relationships between assets, although there may be value in some of the price analysis.

Today the ratio floats, as gold and silver are valued daily by market forces, but this wasn't always the case. The ratio has been permanently set at different times in history - and in different places - by governments seeking monetary stability. If we operate under the premise that Bitcoin and Litecoin are the respective gold and silver of the cryptocurrency world, what happens when we apply the gold silver ratio to the two coins?

Prices have been rounded up to whole numbers for easy math. Some in the mining industry have claimed that currently 9 ounces of silver are mined for every 1 ounce of gold. Litecoin aims to be the silver to Bitcoin's gold and while that may soon be true, with the successful SegWit implementation, two other cryptocurrencies may provide a more accurate comparison. With faster transactions and lower fees, many people have switched from using Bitcoin to Dash for smaller transactions.

Ether is a fuel for operating the distributed application platform Ethereum. The expansion of apps on the Ethereum blockchain is increasing the demand for Ether. Ether is the fuel that powers the new DAP industry.

Silver is a precious metal and an industrial metal. Silver has a multitude of industrial uses and is valuable because of its unique properties. Of course, we cannot make a direct comparison between Bitcoin, gold, Litecoin and silver or any other cryptocurrency for that matter. Although they are all stores of value and are subjected to scarcity, their uses, markets and potentials vary greatly. Industrial use and the physical properties of precious metals cannot be captured or exactly replicated in cryptocurrency.

Even so, it is still interesting to see how the gold to silver ratio could be used to project price or used as a trading methodology. Bitcoin and Litecoin operate in free unmanipulated markets and price is not set through a fix or by ETFs.

Recently, the precious metals industry has been plagued with lawsuits and investigations into alleged price manipulation. Maybe the true value of the ratio is to reverse the calculations and determine fair value of gold and silver based on Bitcoin and Litcoin.

Perhaps the future is a merger of the two asset classes into a new hybrid asset that provides the benefits offered by crypto, of free markets and transparency and the historical pedigree and tangibility offered by precious metals. This is not financial advice, rather it is an intellectual lesson and exploration into the relationship between Bitcoin and Litecoin. The numbers used are rough estimates and are subject to change based on fluctuations in market prices. Interesting observations - thanks for sharing.

Interesting point, although palladium is not really used at all for monetary purposes. BTW did you have any problem accessing this post? There seems to be some issues with Steemit ATM.

It is definitely an interesting relationship to keep an eye on. I love the comparisons. People always ask me of a way to describe the relationship between crypto' and i think this is a great way to explain them. These comparisons are not set in stone, they are fluid and subject to interpretation. I do think asking these questions lends to an interesting discussion. I am glad you enjoyed reading my article! Applying the Gold Silver Ratio to Cryptocurrency.

One well known price indicator used for precious metals is the gold to silver ratio. What is the gold to silver ratio? How the Ratio Works According to Investopedia. What can we learn by applying the gold silver ratio to Bitcoin and Litecoin? Applying the gold silver ratio to Bitcoin and Litecoin If we operate under the premise that Bitcoin and Litecoin are the respective gold and silver of the cryptocurrency world, what happens when we apply the gold silver ratio to the two coins?

As I stated before, the current ratio has been around Historical Average Historical average around Food for thought… This is not financial advice, rather it is an intellectual lesson and exploration into the relationship between Bitcoin and Litecoin. KeepKey If you want to stay up to date on crypto news follow my blog digicrypt. Authors get paid when people like you upvote their post. Everything is kosher at my end. Some people are having trouble accessing certain links at the moment.