If you had invested $500 in Litecoin in 2016, here’s how much you would have now

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For those who remember the early days of crypto, there weren’t as many tokens as there are today.

There were the trailblazers like Bitcoin (BTC 0.01%) and Ethereum (ETH -0.21%), which still dominate the headlines today. And then, of course, there was a batch of altcoins that probably got more attention back then than they do now because they were among the first altcoins back then. One of them was Litecoin (LTC -0.70%), which is still alive and doing as well as any cryptocurrency given the current state of the industry this year. .

Litecoin debuted in 2011, and despite selling off that year, it still has a market capitalization close to $4.7 billion, making it the 14th largest cryptocurrency today. If you had invested $500 in Litecoin in 2016, here is how much you would have now.

Image source: Getty Images.

An ET altcoin

Litecoin was developed by former Google engineer Charles Lee as a response to Bitcoin. When Lee launched the network and the coin, he referred to it as a “lite version of Bitcoin.” The code is also a modified version of Bitcoin’s open source code.

The network has several similarities to Bitcoin. For example, Litecoin still operates on a proof-of-work (PoW) consensus mechanism, in which network miners try to solve a cryptographic puzzle as quickly as possible to have the chance to verify transactions in a block. In exchange for their service, the selected miner receives a reward of Litecoin coins. However, Litecoin uses a less energy-intensive PoW consensus mechanism than Bitcoin.

Just like Bitcoin, Litecoin has a limited supply – 84 million Litecoin coins versus 21 million for Bitcoin. About 70 million Litecoin coins have already been issued, but the last Litecoin coin is still not expected to be issued for 100 years.

A big difference between Litecoin and Bitcoin is that Litecoin can process 54 transactions per second (TPS), compared to Bitcoin, which can only do less than 10. When Litecoin was first released, this was considered a big problem because payment networks have to deal with a lot of GST if they are going to be able to scale and avoid the congestion that slows down the network and leads to high usage fees. For example, Visa, the largest payment rail in the world, is capable of processing 24,000 GST.

In terms of price movement, while Litecoin is much less valued than Bitcoin, it has largely moved in tandem with the world’s most valuable crypto, as so many cryptocurrencies do.

Bitcoin Price Data by YCharts

If you invested $500 in Litecoin in 2016…

Several years ago, I think Litecoin was much bigger than it is today. Now many networks can handle more TPS than Litecoin. That said, I think as one of the oldest cryptocurrencies, Litecoin will continue to get a lot of respect due to its legitimacy, which is a big deal right now after the collapse of the FTX crypto exchange.

If you invested $500 in Litecoin in 2016, you did pretty well. At the end of November 2016, Litecoin was trading for just $3.86.

Today it is trading at over $65, which means that investors who took the token in late 2016 saw a return of around 1,592% compared to 72% for the S&P 500 index. This means that 500 $ invested then is worth about $8,460 today.

Bram Berkowitz has positions in Bitcoin, Ethereum, and Litecoin. The Motley Fool has positions and recommends Bitcoin, Ethereum and Visa. The Motley Fool has a disclosure policy.

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