Litecoin News Update
Cryptocurrency prices are once again in the green, in what seems like the “January effect” being in play. Prices of the top 15 cryptocurrencies, including Litecoin, are soaring on the second day of the new year. We can’t, however, be sure whether this is just an anomaly until the stock markets open and we can draw better parallels.
Wait, why am I comparing cryptocurrencies with stocks? Because, soon after these unconventional investment instruments became popular in 2017, traditional investors began to stack them up with conventional investment vehicles, particularly stocks. But let me remind you that the two are only as similar as chalk and cheese.
In case you missed it, this apples-to-oranges comparison of Litecoin with stock investments recently put the digital currency in dire straits.
Recall that Litecoin founder Charlie Lee sold his litecoins in December 2017, when prices had peaked over $300.00. He said his motive was simple: removing a conflict of interest.
He began to notice that his tweets were swinging Litecoin prices back and forth, and he realized that it was time for him to step away to avoid market manipulation.
He sold his holdings at an all-time high, just as any sane investor would do, and then he informed the world of his move in the most transparent manner possible. Might I remind you that transparency is one of Litecoin’s distinguishing attributes.
Many of the naive investors, however, misunderstood Lee’s reasoning. This simple news was taken with a grain of salt, and investors began to draw fallacious parallels between Litecoin and stock investments. One argument was that the sell-off was like a CEO selling all of his shares in his company, and that other investors might as well sell their holdings before it’s too late.
Here’s why that line of thinking is absolutely erroneous.
Charlie Lee is not the CEO of Litecoin; he’s only the creator. He founded it, but he’s not running the show. Nobody is. That’s the whole point of this “decentralized” digital currency. Second, the Litecoin foundation does not work on the same principles as any other for-profit company.
So, by comparing Litecoin and stocks, we’re doing a disservice to Litecoin, which is aiming to replace fiat currency as an uncensored, uncontrolled, borderless digital alternative.
Investors have been throwing blame at Lee for causing a crash in LTC prices, but the reality is that the drop in Litecoin is mostly attributable to an industry-wide price correction. Recall that, during this same period, Bitcoin prices fell by 20%.
Let’s also not forget that Bitcoin and Litecoin prices have long moved in tandem. Every time Bitcoin faces a sell-off, Litecoin is the sitting duck that gets caught in the crossfire. Litecoin is viewed, and rightly so, as the flipside of the same coin. It is touted as “digital silver”—the cheaper and faster medium of exchange than Bitcoin.
Chart courtesy of TradingView.com
Anyhow, the tirade of accusations vexed Lee to the point where he had to provide repeated clarifications. Here’s how he has responded lately, promising to take Litecoin back to record highs.
Seeing how people lost trust because I sold makes me more convinced that it was the right move. Litecoin was too centralized and dependent on me. Eventually, for Litecoin to succeed, I need to step away. But I promise I won't do that until I've helped LTC climb back past the ATH.
— Charlie Lee [LTC] (@SatoshiLite) December 31, 2017
Lee is presently seeking partnerships with companies to support Litecoin as a mode of payment. He is in talks with cryptocurrency-based e-commerce platform “OpenBazaar,” some popular online wallets, payments processors, and goods-trading platforms.
So we’re looking ahead, not back!
The Litecoin price is up about 13.8% at the time of this writing, with the LTC-to-USD rate at $259.31. Our Litecoin price forecast is bullish.
We do not doubt Litecoin’s inherent utility as a better Bitcoin alternative. We do, however, remain cautious, as some investors take miscalculated decisions. For now, however, we’re holding on to our original Litecoin price prediction for 2018, with an LTC price target of $400.00.