BLOG: Litecoin - the Bitcoin for late adopters?

Geeks shouldn't get all the fun, says Emma Haslett. Litecoin is the silver to Bitcoin's gold - and it's made huge gains over the past few days.

by Emma Haslett
Last Updated: 13 Dec 2013

The trouble with early adopters is that, well, it's all a bit unfair, isn't it? They're tweeting and listening to music for free and making zillions out of Bitcoin before the rest of us have finished our coffee in the morning. If we'd have known about that stuff, we'd totally have been doing it too.

Bitcoin is a case in point. Since the digital currency - or cryptocurrency, to give it its proper name – was launched in 2009, the price of a single coin has risen to over $1,000, from a low of $0.30 in 2011. There are dozens of stories of early adopters being made into zillionaires: Norwegian investor Kristoffer Koch, for example, who forgot he had an account and then realised his original £17 investment had grown to £430,000.

Now the price of a single coin is topping $1,000, the rest of us don't really have much of a look-in. There's a sense that, after its mad rise over the past few months, at some point in the not-too-distant future it will plateau - so even if we did have a spare grand lying around, buying Bitcoin wouldn’t be quite as satisfying as if we had invested two years ago. We might make a bit - but those who bought it at its launch will make much, much more.

If only there was a similar currency that was much earlier on in its life cycle, much more affordable - with much more potential to make us latecomers rich...

Step forward, Litecoin. The currency, which has been described as 'silver to Bitcoin's gold', was invented by ex-Googler Charlie Lee (none of this pseudonymous inventor stuff Bitcoin has to put up with) in 2011.

The idea was to iron out a number of difficulties with Bitcoin: firstly, that transactions can take up to an hour to complete (with Litecoin it takes two and a half minutes). Secondly, it's easier to ‘mine’: getting hold of it doesn't require a high-spec, ultra-futuristic computer. Although it does require the same level of geekish know-how - which cuts me out, anyway...

There are, of course, a number of Bitcoin pretenders - but in the past few days, Litecoin is the one that has caught investors' imaginations. Just look at this graph:

Source: Cryptocoincharts

And compare that with Bitcoin's rise over a similar period:

Source: Cryptocoincharts

In the interests of journalistic intrepidness (and, you know, getting stinking rich), I bought some Litecoin (1.19664, or £24.02 worth, to be exact) last night. Getting hold of it is by no means straightforward. The easiest way I could work out was to buy Bitcoin - I used the enormously over-priced Bittylicious – then trade my Bitcoin for Litecoin on cryptocurrency exchange BTC-E. When I woke up this morning, its value had shot up by nearly 25% - just enough to cover the gruesome purchasing and trading costs.

Of course, there is the risk that even tardier investors than I will see Litecoin as over-inflated and choose instead to pump up one of its many rivals. But you never know. And it'll be pretty exciting while it lasts. Latecomers: start your engines....

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