Litecoin Down 30% from Record High as Correction Continues
user

Cryptocurrencies

Litecoin Down 30% from Record High as Correction Continues

Posted on .

Litecoin Down 30% from Record High as Correction Continues

Introduction

This article was posted on Thursday, 08:59, UTC.

Litecoin (LTC/USD) prices have seen heavy volatility over the past three weeks. Following a series of all-time highs, prices are down more than 30% in a synchronized global collapse instigated by China’s ICO ban.

// -- Discuss and ask questions in our community on Workplace. Don't have an account? Send Jonas Borchgrevink an email -- //

LTC/USD Correction Wipes Out Early-September Gains

The LTC/USD peaked at $90.90 on Sept. 2, according to CoinMarketCap. At $90 a pop, litecoin’s market cap approached $4.8 billion as 24-hour volume peaked at more than $1.8 billion. Prices are down more than $30 over the past two weeks to reach the current level of $61.00. The token is trading within a narrow range at the start of Thursday’s session.

To be frank, litecoin was severely overbought at the start of the September following a month of lateral moves. The Relative Strength Index has since moderated below 50.00. More correction is expected in the coming weeks, as prices target the corresponding Fibonacci retracement levels between $60.00 and $51.00.

// -- Become a yearly Platinum Member and save 69 USD and get access to our secret group on Workplace. Click here to change your current membership -- //

Crypto Meltdown Shaves $40 Billion Off Market Value

The major coins have declined sharply this month after Chinese regulators banned initial coin offerings (ICO), the crowdsourcing model that has taken the world by storm. China is said to be mounting a broader attack on the digital currency market, including an all-out ban on bitcoin exchanges.

The ban will only apply to trading of cryptocurrencies on exchanges, leaving OTC markets unaffected. Trading volume is expected to fall dramatically as a result, especially given China’s out-sized role in the crypto market. The country accounts for about 23% of bitcoin trades. It is also home to some of the world’s biggest bitcoin miners.

Digital currency is a contentious topic for Chinese policymakers, who have zero tolerance for any activity that undermines stability. The People’s Bank of China has intervened in the market on several occasions to evaluate the risks. For some analysts, the latest crackdown is a backhanded attempt at controlling capital flight.

Litecoin’s Future

As the fifth-largest cryptocurrency by value, litecoin has attracted a lot of attention over the past nine months. The bitcoin rival confirms payments faster and is more adaptive to up-scaling. Like bitcoin, the litecoin token is deflationary in nature because of the simple supply/demand logic that underlies it.

Just as bitcoin will have 21 million coins in its entire lifespan, litecoin will only ever produce 84 million. This finite supply is a big draw for investors.

Litecoin creator Charlie Lee says the major difference between bitcoin and altcoins is that the former will be used as a store of value, whereas the latter will be used for purchases.

Litecoin enthusiasts cite transaction speed, supply size and use case as the major catalysts for its expansion. These are also some of the more compelling reasons why they prefer it to bitcoin. However, as Melwin Philip of Seeking Alpha notes, there’s no reason why bitcoin and litecoin can’t be used in tandem.

Charlie Lee drives this point home when he describes bitcoin as “crypto gold” and litecoin as “crypto silver.”

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



Feedback or Requests?

Sam Bourgi

Sam Bourgi

Sam Bourgi is Contributing Writer to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.

There are no comments.

View Comments (0) ...
Navigation
The team:
Dmitriy Lavrov
Analyst
Dmitriy Lavrov is a professional trader, technical analyst and money manager with 10 years of trading experience. He covers Forex, Commodities and Cryptocurrencies. He is among the top 10 most Read More
Jonas Borchgrevink
Founder
Jonas Borchgrevink is the founder of Hacked.com and CryptoCoinsNews.com. He is a serial entrepreneur, trader and investor. He shares his own personal journey on Hacked.com. // -- Discuss and ask Read More
Mate Csar
Analyst
Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive Read More
Mati Greenspan
Analyst
Senior Market Analyst at Etoro.com. // -- Discuss and ask questions in our community on Workplace. Don't have an account? Send Jonas Borchgrevink an email -- // Important: Never invest Read More
Rakesh Upadhyay
Analyst
Rakesh Upadhyay is a Technical Analyst and Portfolio Consultant for The Summit Group. He has more than a decade of experience as a private trader. His philosophy is to use Read More
Pamela Meropiali
Account Manager
Pamela Meropiali is responsible for users on Hacked.com. // -- Discuss and ask questions in our community on Workplace. Don't have an account? Send Jonas Borchgrevink an email -- // Read More
Joseph Young
Journalist
Joseph Young is a finance and tech journalist & analyst based in Hong Kong. He has worked with leading media and news agencies in the technology and finance industries, offering Read More
The Big Question: Is the Chinese economy cooling again? Major…