Make way, bitcoin. Theres a competing digital currency angling for the spotlight.

Merchants and investors are taking notice of litecoin, which is pitched by its developers as cheaper to generate, more plentiful and easier to use for small transactions than bitcoin. While prices for both have slid since a surge late last year, litecoins remains about 490 percent higher than six months ago, compared with about 140 percent for bitcoin. Daily litecoin transactions also have climbed faster.

The total value of litecoins available for use ranks second only to bitcoins, according to CoinMarketCap, a website tracking more than 200 digital currencies. That status has helped make litecoin an obvious alternative for investors and enthusiasts seeking new opportunities to profit from virtual money.

Litecoin right now is where bitcoin was the same time last year, Michael Curry, co-founder of Canadian digital-currency exchange Vault of Satoshi, said in an interview. As people are becoming more familiar with bitcoin, they are starting to see there are other coins out there.

Bitcoins jumped from about $13 at the start of last year to more than $1,200 in December, then slid to about $490 as of yesterday, according to CoinDesk, which tracks prices across key exchanges. Litecoins, which surpassed $48 in November, traded for about $12 yesterday, according to data from exchange BTC-e.

Bitcoins jumped from about $13 at the start of last year to more than $1,200 in December, then slid to about $490 as of yesterday, according to CoinDesk, which tracks prices across key exchanges. Close

Bitcoins jumped from about $13 at the start of last year to more than $1,200 in... Read More

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Bitcoins jumped from about $13 at the start of last year to more than $1,200 in December, then slid to about $490 as of yesterday, according to CoinDesk, which tracks prices across key exchanges.

The average number of daily transactions in litecoins this month is 155 percent greater than Octobers level, according to CoinDesk data. That compares with a 19 percent increase for bitcoins. Daily transactions in bitcoins this month still outnumber those in litecoins almost sevenfold, the data show.

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Bitcoin Wannabe Litecoin Emerges as Low-Price Challenger