Litecoin is the creation of Charlie Lee, and this in itself is interesting to traders. Before creating his cryptocurrency, the developer managed to work as a leading engineer at Google and Microsoft, as well as to make a successful career in trading currency pairs, stocks, and goods.
Originally, Lee developed Litecoin as a means of payment. The coin allows for very fast transactions, is protected from cyber-attacks, can be used to pay for ordinary goods.
Litecoin has a protection mechanism against pumps and dumps. Due to the relatively high issue and low price of the coin, it’s one of the most decentralized crypto assets. No user holds more than 5% of the total amount of coins.
By the way, about the emission, it’s limited to 84 million coins. According to preliminary calculations, the mining of the cryptocurrency will continue until 2140. As of 2019, 70% of all coins were mined, which is important for traders, almost all of them are in circulation.
In 2017 Litecoin had an upgrade, which was introduced by Protocol SegWit. This solved the issue of scalability and led to the rapid growth of the exchange rate – in six months the coin has risen in price by 80 times or by 8000%.
In late 2018, Lee launched the Lightning Network for Litecoin. This technology can significantly speed up the processing time of transactions. The market reacted to the innovation by the growth of the coin rate.
In the same year, peer-to-peer technology of cross-platform exchange was tested. As a result of tests, it was revealed that cryptocurrencies can be exchanged between themselves by receiving data directly from the blockchain. This news has attracted new investors; as a result, the exchange rate of Litecoin has increased.
On July 25, 2019, Charlie Lee had an important conversation with Warren Buffett. Although the legendary billionaire did not openly speak about his attitude to cryptocurrencies, the very fact of such a conversation was the impetus for the next strengthening of Litecoin.
What affects the price
For most traders, Litecoin may seem boring, because the coin does not show high volatility, doesn’t lend itself to pumps and dumps on the news background, only indirectly tied to the price of Bitcoin. It reacts to the fall or rise of the rate much weaker than other altcoins.
The only strong influence factor is the overall demand for cryptocurrencies. In a saturated market, Litecoin becomes slightly cheaper, as most investors don’t seek to sell the asset and consider it in the long term.
When the market is in a phase of high demand, Litecoin is rapidly rising in price, while bringing good profits. The currency is categorically not suitable for scalping and should be considered only as a hedging tool or in the form of long-term futures.
In both cases, the trader will receive minimal risks and the opportunity to increase capital by 10-15 times, as it was in 2017 when in the wake of the popularity of Bitcoin, many users discovered Litecoin and appreciated all its advantages.
Although the coin has been called a direct competitor of Bitcoin several times, Litecoin does not pose a real danger for digital gold. And this is understood by all market participants, so the asset is not considered as the main, keeping 10-20% of the crypto-portfolio in this coin is quite reasonable.
Paradoxically, the course of Litecoin can be influenced by Charlie Lee himself, even though he sold most of his coins. The application developer perceived by audience seriously enough. The market 1-2 days before the event, and 4-5 days after shows very high volatility.
It explains very simply: he never been seen in the scandals, intrigues, and manipulation of the facts. Most of his statements were in the case, and 75% of the forecasts were exact.