Despite many investors’ laser-like attention on Bitcoin’s astonishing run, one currency that is far surpassing Bitcoin and other cryptocurrencies is Litecoin, which is up almost 340% this year with a market value of $8.3 billion as of today. According to a thorough piece in Bloomberg, the digital currency has risen at more than double the rate of Bitcoin in 2019, and is currently the seventh-largest digital asset, according to statistics from Mosaic Research Ltd.
Bitcoin is the most valuable cryptocurrency, having a market value of around $160 billion as of early afternoon trade. That’s remarkable, but it pales in comparison to Litecoin’s ascent.
Litecoin’s ascent is being fueled by the increasing adoption of cryptocurrencies by major corporations like as Facebook Inc. (FB), Fidelity Investments, and AT&T Inc. (T), as well as Litecoin’s forthcoming halving, or “halvening.” This event, which will limit the quantity of coins issued to Litecoin miners by 50%, is scheduled for August 6. The causes driving the gains “are legitimate, genuine, and verifiable,” said to David Tawil, head of crypto hedge firm ProChain Capital.
‘Halving’ Drives Crypto Prices
Miners presently earn 25 new Litecoins every block, however this will be reduced to 12.5 in the future. Because of basic supply and demand dynamics, a drop in supply should push up the price of the coin, just as the cryptocurrency resurgence increases demand.
“Every time we’ve seen a halving event in Bitcoin or Litecoin, the price has surged astronomically,” said Mati Greenspan, senior market analyst at eToro. “So, if that tendency continues, what we’ve seen so far is little potatoes,” he added. “This is rather typical in the cryptocurrency market.”
When the previous Litcoin halvening occurred four years ago, the digital currency’s price increased by about 60% in the three months before it, according to CoinMarketCap.com. Bitcoin has had similar rallies in the run-up to previous halvenings, and the next one is likely in May.
While Litecoin is soaring and many bulls anticipate it to break new highs, many experts caution that cryptocurrencies such as Bitcoin are still mostly utilized for speculation and very little for trade. Litecoin is also prone to the same dynamics that have affected Bitcoin, such as its volatility and speculation, as well as the price crash that occurred in 2018. Litecoin “only lives if Bitcoin is valued,” according to Aaron Brown, a Bloomberg Opinion contributor. “It’s an established, easy transaction currency perfectly adapted to a future where Bitcoin is the store of value,” he continued. In a world where Bitcoin values are low, I don’t believe it has much value.”
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