Known as the silver to bitcoin’s gold, prices of litecoin have been soaring ever since bigger brother bitcoin has started hitting all-time highs. Looking for the next big thing as bitcoins have gone from the $120’s to on some exchanges above $1000 this week, litecoin prices have surged to above $40 after languishing during the summer below $2.

Unlike bitcoins, litecoins trading volumes are still quite low with much fewer exchange venues offering the digital currency. In addition, there is currently still very few merchants that accept litecoins, making actual usage limited to person to person transfers. Overall litecoin trading and usage resembles that of bitcoins in 2011.

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Back in June 2011, after trading in obscurity for two plus years, prices of rose from the low single digits to a high of $32 before eventually falling to a low of about $2 in November of that year. At the time, it was the first substantial ‘moment in the sun’ for bitcoins as the price appreciation put them on the map of many financial and technology journalists.

While prices did rise, the reality at the time was that existing infrastructure for buying/selling of bitcoins, as well as spending them was limited. Fast forward to late 2012, and options for transacting in the digital currency have multiplied just as fast as prices have moved higher this year. As such, when the 2013 rally began in March, not only did bitcoins become much more accessible, but so did their use cases. In addition, with the seizure of Liberty Reserve and its media attention, it brought to the forefront of the western world that uses and demand for alternative payment systems is not only a much greater than billion dollar market, but also growing steadily.

Similarly, litecoins can be said to be following the direction of where bitcoins were in 2011. With not much usage of the digital currency, after a brief move higher in March/April this year prices gradually fell below $2. As speculators are widening their nets and looking for the next bitcoin, it has triggered demand in litecoin. Regardless of the lack of merchants accepting them, it still hasn’t stopped prices from moving higher. From an initial move to around $10 last week, prices have quadrupled to the $40 over the last 24 hours.

The question now becomes whether the speculative interest will lead to the creation of business interest. Are VCs that missed investing in bitcoin related firms, going to be funding litecoin initiatives? If the answer is yes, then that bodes well for long term prices stabilization. However, if litecoin use cases remain in obscurity, it will mean there is little to stop prices from falling back below $5 if prices of bitcoin halt their ascent.