Litecoin is one of the best known cryptocurrencies in the world. It was created as a fork of the bitcoin network to offer faster transactions and cheaper fees. Charlie Lee, its founder, has been working hard with an experienced developer team in order to offer a good quality currency.
2018 could be the year in which we will see the Lightning Network and Atomic Swaps in action. But let’s first understand what these two terms mean and how they can affect Litecoin’s price and network.
Atomic Swaps – A Secure and Fast Way of Exchanging Currencies
In order to trade Bitcoin for Litecoin or vice versa, it s necessary to pass through a cryptocurrency exchange. Having the funds in an online exchange involves several risks that most of the hodlers and investors with high amounts of money want to avoid. It is safer to have the funds in a cold storage wallet rather than in an exchange.
But with Atomic Swaps, any individual or enterprise would be able to trade these cryptocurrencies with another party without using an exchange. Atomic Swaps are a decentralized technology that allows different parties to exchange their coins in a matter of seconds.
Let’s give an example. You can be in a shop that accepts bitcoin, but you only have Litecoin. You can pay with Litecoin and the owner will receive Bitcoin in just a few seconds. This works with a secure swap contract in which different currencies now coexist in the same environment.
That’s really important for the liquidity of both currencies. Charlie Lee has commented that fiat currencies are better for day to day use compared to Litecoin. Now, it would be easier to use Litecoin to perform daily purchases. Furthermore, with the Lightning Network, the Bitcoin environment and Litecoin will be more united than never before.
Lightning Network – For Faster and Cheaper Transactions
The Lightning Network will be another step for the cryptocurrency world this year. Alongside with the atomic swaps, this technology could be the most efficient solution for the scalability problem that some currencies have.
We will not explain in a technical way how this network works. But let’s try to understand how it can be used. It offers instant payments without the necessity to be worried about confirmation times. With an off-chain transaction, payments are speeded up and the fees are strongly reduced (according to developers).
The scalability problem finds an important off-chain solution. The Lightning Network is capable of process millions to billions of transactions per second. That would allow many new individuals and enterprises to process transactions almost instantly.
Litecoin and Bitcoin Environments
With Atomic Swaps and the Lightning Network, Litecoin and Bitcoin have an important upgrade coming. Let’s imagine that we want to store value in the Bitcoin network but we also want to use Litecoin to make different purchases. Bitcoin and Litecoin will now have cheaper fees and faster transactions, but Bitcoin will still offer higher fees than Litecoin. Because of this reason, the bridges that will link Litecoin and Bitcoin are of important relevance.
With more people using cryptocurrencies, Atomic Swaps, the Lightning Network, Litecoin will be worth much more, the same as Bitcoin. Understanding that these two currencies can work side by side is an important step for the cryptocurrency world.
If individuals in Bitcoin want to do some micropayments, then, they will perform an Atomic Swap between networks and use Litecoin (with the lightning network available) to perform these transactions. If you have Litecoin and you want to pay for something in Bitcoin, you will just do an Atomic Swap and the vendor will receive Bitcoin in just some seconds.
Litecoin has been growing at an incredible rate during the last year. When at the beginning of the year, one Litecoin was equal to $4 dollars and reached an ATH at $400 dollars. At the moment is being traded around $300 dollars and in the coming year has a lot of growth potential.
The network has processed an incredible amount of transactions, equal to the market capitalization of Litecoin. If we keep this trend, with a better integration with Bitcoin (thanks to Atomic Swaps and the Lightning Network), then the price can grow strongly. I am not sure whether it is possible to register 4,000 percent increase, something similar to the last year. But we even a fraction of this will be desired. If Litecoin reaches $1,500 dollars, then we will be talking about an increase of 500 percent.
We only need to wait to se whether the theory will be reality. The Lightning Network and the Atomic Swaps need to be tested very well before being implemented. And once they will be available, they will need to be updated and enhanced.
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