Litecoin (LTC) Dumps 9% as Halving Weekend Fails to Ignite Price Run
Litecoin was the biggest loser among the top ten cryptocurrencies on Sunday morning with 4.6% losses over 24 hours. With the LTC block reward halving scheduled for Monday, the entire pre-halving weekend turned out to be a damp squib, with LTC losing almost 9% since Thursday night.
Cliches contain plenty of truth, and the old maxim of “buy the rumour, sell the news” was clearly applied to Litecoin in 2019. Investors may now be wondering why Litecoin didn’t double or treble in the run up to the block reward halving, but in reality it did much more.
Litecoin’s Ups and Downs
Between January and June, Litecoin increased 511% in value. That carried the coin price from $23.94 right up to $146.43.
We witnessed similar price pumps from a few small-cap altcoins, but Litecoin’s surge outpaced Bitcoin, Ethereum, XRP and the rest by quite some margin. If Bitcoin had followed Litecoin’s lead, it would be priced at over $20,000 by now.
With hindsight, Litecoin’s 6x growth now appears to have been fuelled by the block reward halving. The only trouble is, the big players anticipated this before it even became a talking point in broader media circles. Since that brief peak of $146 in late June, the LTC price subsequently dropped to $77 by mid-July.
A brief rally back up to the $100 range didn’t hold, and on Sunday the LTC valuation fell further, from $95.98 down to $91.48.
Supporters of Litecoin think of it as a faster, cheaper version of Bitcoin. A glance at LTC’s numbers prove that to be largely true. For example, LTC has a 2.5 minute block time, compared to Bitcoin’s 10 minutes. Its fees are also miniscule compared to Bitcoin, as evidenced in 2018 when a $62 million LTC transaction cost just $0.50 to send.
Skeptics of Litecoin maintain that it has no real reason to exist, and that the best it can ever be is a testnet for Bitcoin. Again, there’s some truth to be found here. Litecoin has existed for the best part of 10 years, and its active addresses still amount to less than a tenth that of Bitcoin’s according to data from Bitinfocharts.
Before Bitcoin implemented Lightning Network, Litecoin did it first. Before Bitcoin activated SegWit, Litecoin did it first. Yet none of these achievements brought increased fame or fortune to Litecoin. The first crypto people see when they enter this space is, and will remain, Bitcoin.
Ultimately, Litecoin’s expected price pump was baked into its valuation for most of the year. When Ethereum gears up for its big push towards Eth 2.0 in the next year; or when Bitcoin undergoes its own next block reward halving in May 2020, this might be something useful to keep in mind.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock. Charts via TradingView.