Detractors calling Litecoin a ‘dead’ project, or a ‘shitcoin’, are simply wrong. Despite the proliferation of altcoins over the past few years, Litecoin remains one of the most widely adopted and utilized networks.
Beyond usage, there are a variety of reasons that point to the potential of this project having yet to be fully tapped. With the recent crackdown on altcoins by the SEC, and anticipation over a halving only 51 days away, now may just be the time for Litecoin to recapture its share of the spotlight and thrive during a period of uncertainty.
Why Litecoin Still Has a Future
As stated, Litecoin may have a bright future for a variety of reasons. While not an exhaustive list, the following are a few examples of these.
Fast
With 2-3min blocktimes and minimal network congestion, Litecoin is one of the faster PoW networks on offer today. Once scaling solutions like the Lightning network are taken in to account, transaction settlement times are nearly instant, making it a perfect medium through which to transact value on a small or large scale.
Cheap
For even high-priority transactions, the Litecoin network boasts exceptionally cheap fees – currently hovering around $0.01. While this will of course vary, Litecoin has never suffered from runaway fees like Bitcoin and Ethereum, currently making it much more appealing for everyday use.
Private
Although not as private as a project like Monero, the use of extension blocks – which were made possible after the activation of Mimblewimble – allow for transaction details to be obscured. Unlike some networks where every transaction is obscured, the use of extension blocks is an optional feature, making the project much less likely to be removed from exchanges due to AML/KYC concerns.
Structured Inflation
Like Bitcoin, Litecoin not only boasts a fixed supply, but a known emissions schedule that sees its block rewards cut in half every four years. The next instance of this is set to occur in Aug. 2023.
While the case is not as clear-cut with Litecoin, halving events are typically followed by a period in which the networks respective token rises in price as miners adapt to increased operating costs.
Versatility
Litecoin is an extremely versatile network that functions not only as a decentralized currency, but also supports scaling solutions like the Lightning Network, and most recently ordinal inscriptions. As a result, it is able to boast nearly all the perks of Bitcoin, and more.
Regulatory Ambiguity
Due to the structuring of its launch (no pre-mine, no ICO) and continued reliance on a proof-of-work (PoW) consensus mechanism, Litecoin is not surrounded by the same level of regulatory ambiguity as most altcoins.
In a time when the vast majority of the market is being labelled a security, Litecoin has remained removed from such classification. This holds true in many jurisdictions, including the increasingly digital asset friendly Hong Kong.
A Redundancy
It should be noted that while Litecoin may have great potential, a bright future is most definitely not a sure-thing. More specifically, its future becomes a little murkier when you consider that there is a Litecoin foundation tasked with forwarding development of the network. This single point may be enough for the SEC to deem LTC a security – warranted or not – as the foundation could be perceived as a ‘common-enterprise’ – a key component of the Howey-test.
Furthermore, Litecoin is not the only project to increase its functionality and performance over the years. With a variety of scaling solutions in development for Bitcoin, the question then becomes ‘Is Litecoin really needed’? Bitcoin already has the worlds most robust and decentralized blockchain network. By imbuing Bitcoin with the capabilities that once differentiated rivals from itself, many of those projects will simply become obsolete. Although Litecoin was envisioned as functioning akin to digital silver vs. Bitcoins digital gold from the beginning, this may not end up being the case. It may simply end up/remain a redundancy within the digital asset market.
Performance
So with all this in mind, how has LTC performed over the course of 2023? The following is a brief look at various metrics, providing an overview of the Litecoin network and its current trajectory.
Uptime
Since day-1, the Litecoin network has boasted a flawless, 100% uptime record, with 2023 being no different.
Source: Twitter @indigo_nakamoto
This means that when TradFi shuts down on evenings and weekends, experiences network outages, pauses services for upgrades, etc., the Litecoin network has just kept trucking along, processing transactions as usual.
Price
Despite the recent market dip resulting from the SEC and its enforcement actions against Binance and Coinbase, Litecoin (LTC) remains up roughly 10% on the year and nearly holding steady over a 24hr period at time of writing. Despite this being the case, the price of LTC remains far removed from its all-time-high of ~$410.
At time of writing, LTC was being traded for roughly ~$77.
Hashrate
Hashrate is an important metric to follow, as it provides insight in to the security of a given network. Furthermore, it sheds light on the activity of PoW miners, and whether or not competition is trending upwards. Since July of 2022, hashrate for the Litecoin network has been steadily increasing, recently boasting new highs of ~780 Thash/s.
Source: messari.io/asset/litecoin/chart/hashrate
At time of writing, the Litecoin network boasted a cumulative hashrate of ~767 Thash/s.
Volume
Perhaps due to the introduction of ordinals, or anticipation of its upcoming halving, volume on the Litecoin network has increased in 2023. This has resulted in an all-time-high of wallet addresses carrying an LTC balance.
Typically daily trading volume of LTC range from $500M to $1B. The trading volume of such a project is particularly important, as it points to good liquidity – meaning there is no shortage of makers and/or takers.
At time of writing, the Litecoin network had a 24hr trading volume of roughly ~$465M
MarketCap
Although Litecoin was not immune to the most recent market dip, it fared notably better than the majority of projects. So while it currently sits as the 12th largest project by marketcap, it is only one strong day away from leapfrogging projects like Solana and Polygon – which are down nearly 30% over the past 7days – and entering the top-10 once again.
At time of writing, Litecoin boasts a marketcap of roughly ~$5.7B.
Exchange Listings
Regardless of the exchange, Litecoin is almost always one of the very first projects to be supported/listed. This is partly due to its similarities to Bitcoin, along with its demand. This trend has continued in 2023, with no major delistings and widespread support. Some of the leading exchanges where LTC can be purchased include,
Final Word
Overall, Litecoin is one of a very select few digital assets that appears to be safe from being deemed a security. While not as expansive as Bitcoin, its network also remains quite robust with a group of dedicated miners.
Each of the above points are reasons why Litecoin has, and should continue, to thrive within the digital asset market. While many projects have surpassed Litecoin by marketcap over the years, the vast majority of these are fleeting, while digital silver remains a constant. Sure, Litecoin does not command the market-share it once did, but this is a project that has remained resilient through multiple bear/bull cycles, and looks poised to capitalize in the coming months while altcoins are put through the wringer.
To learn more about this project, make sure to visit our Investing in Litecoin guide.
The post It’s Time for Litecoin (LTC) to Thrive as Altcoin Market Comes Under Regulatory Scrutiny appeared first on Securities.io.
