Litecoin [LTC] is one of the coins that suffered biggest hit by the bear market. The overall market cap has dropped below $2 billion and seems the shedding is not over yet.
It is a well known fact that Charlie Lee sold at the peak of LTC price and tweeted a very good advice to the rest of the holders: On December 12th, 2017, Charlie Lee sent out a tweet telling people not to get too excited with the unsustainable bull run. Charlie warned about the pending multi-year bear market and that anyone who could not handle Litecoin (LTC) dropping to $20 should not buy it. While many attacked him as a FUD instigator, his reasons for making these assertions were rock solid and since LTC is now hovering just aboe $30. Charlie explained that every time the crypto market rises up too fast, it overshoots its real value, which leads to a huge correction, and a price consolidation. Charlie’s predictions have come true.
Charlie is not active in LTC for quite some time – it has been years since he contributed to the development of the once second largest cryptocurrency, that is now ranked at number 7 on CMC rankings.
This fall in the rankings is probably going to continue and LTC could be soon out the top 10 of CMC. Coinbase is expected to add ZCash soon which could propel them to the top 10 spot and a whole slew of stablecoins is travelling upwards like a caravan planning to invade the top 10 spots and join their older brother Tether.
To repeat parts of my earlier article about grim LTC outlook.
The reason LTC has no future is lack of unique value proposition – it is just blunt copy of bitcoin with couple of parameters changed.
Litecoin can do everything Bitcoin can and it is often called a testnet for bitcoin. But who needs a multi-billion testnet – who needs two identical projects as one is enough and this is a winner takes all battle.
Litecoin depends on Bitcoin. This is not just a hypothesis, this was Charlie’s vision from the project’s inception.
LTC enjoyed the treatment as a bitcoin’s little brother – technology was similar so exchanges and wallets could easily integrate it where ever they integrated bitcoin. This gave it exposure and liquidity which drove its price up especially as many would use it for faster transactions between exchanges or wallets as it had faster transaction time than bitcoin. In the meantime, there are many other coins that can be used for this purpose that are even faster and cheaper, almost free (Nano for example).
With Coinbase and other exchanges adding new projects, the top 10 market caps being dominated by some very diverse and colorful coins and a general lack of media attention and focus on Litecoin unless it makes some significant price movement, I’m not sure what would motivate new comers do the research necessary to learn about Litecoin’s potential.
So if Litecoin’s utility as a micro-payment solution is now in question, where does it stand? I suppose it could be the “silver” to Bitcoin’s “gold”, but if Bitcoins are (basically) infinitely divisible and act as a good store of value, then what does Litecoin do?
As Bitcoin network keeps being optimized and upgraded with new innovations like Lightning Network, use cases of Litecoin will disappear and so will its reason to exist.
Litecoin doesn’t have the name recognition that Bitcoin has. It does have a fantastic advantage to make improvements to itself much faster than Bitcoin does, but with the rise of so many other projects that have base codes that are already more fit for micro-transactions and scaling, has Litecoin missed the train? I would say yes.