There was a time in mid-2017 when I owned Litecoin – about 5% of my crypto portfolio, to 95% for Bitcoin. I thought it could be, as Charlie Lee put it, “silver to Bitcoin’s gold” – which struck a chord for me, given my 15 years of investing, and commentating leadership in, Precious Metals.
However, once SegWit locked into Bitcoin, and a flood of crypto-dividends followed, I sold my Litecoin for Bitcoin – realizing there was no reason I could think of, why it should outperform Bitcoin over time…let alone, when considering Bitcoin’s likely “dividend yield.”
Litecoin was forked from Bitcoin in 2011, with the goal of having faster transactions; i.e., the same use case proposition that all Bitcoin forks have failed to produce. True, Litecoin’s longevity and hash power make it extremely stable, and likely to last as long as Bitcoin. However, it does not actually do anything – so to me, it is simply Bitcoin with less hash rate, and no defined use case. And no, saying it’s a “testnet for Bitcoin” is ridiculous, as EVERYTHING is a testnet for Bitcoin.
Sure, some people will accept LTC as payment, compared to none for other cryptocurrencies; but this group is small – and frankly, they only do so because it is liquid enough to be quickly converted to Bitcoin or cash. So, what it comes down to is, Litecoin is Bitcoin with 4x the supply, much lower hash rate, and no defined use case.
Which is fine, until you realize that throughout its entire six-year trading history, since being listed on exchanges, it has traded at an average of 1% of Bitcoin…as it is today, at 1.1%. Sure, it has had a few modest spikes to 2% - principally during the massive bubble of late 2017-early 2018, when ALL altcoins spike versus Bitcoin…but aside from that, no matter what Litecoin does, it has remained pinned to 1%.
And by the way, what happened when it spiked to 2% of Bitcoin in 2018? Charlie Lee sold ALL his Litecoin – for reasons that frankly, make little sense – while retaining ALL his Bitcoin.
One thing Litecoin has that is impressive, and a significant positive, is the fervor of its investor community – which is why I received such venom for simply posting that fellow “Crypto Trinity” member Bitcoin Rhodium has a more defined store-of-value use case, and is vastly more undervalued.
https://twitter.com/Andy_Hoffman_CG/status/1145822798201278464
- Andy_Hoffman_CG
However, this doesn’t change the fact that Litecoin is the perfect example of a coin without a defined use case – that consequently, has not been able to appreciate versus Bitcoin after all these years. Yes it will survive indefinitely, but just because it is “cheaper” than Bitcoin - $120 versus $10,000 – that doesn’t mean it has more appreciation potential.
To me, Litecoin is in some ways “silver to Bitcoin’s gold” – but anyone watching silver, knows it is now trading at an all-time low ratio to gold. Gold is simply more valuable – and now that crypto has arrived, there is no use case to be made for silver; which is kind of where Litecoin stands, now that crypto-dividends have arrived in Bitcoin.
Yes, Bitcoin Rhodium is far less liquid than Litecoin – so in some ways, for now, the comparison is apples-to-oranges. However, unlike Litecoin, Bitcoin Rhodium was created explicitly to isolate Bitcoin’s store of value function – which today’s second quarter “Strong Hands” in-kind dividend program speaks to, in spades!
https://twitter.com/Andy_Hoffman_CG/status/1146030316970078208
- Andy_Hoffman_CG
Throw in the fact that HUGE ANNOUNCEMENTS are imminent – like CMC exchanges, and Trezor support – that will finalize XRC’s mainstreaming process, and we’re talking about a coin with a unique store of value proposition, on the verge of significant liquidity improvement, in the very near-term.
https://twitter.com/Andy_Hoffman_CG/status/1144934081941168131
- Andy_Hoffman_CG
If you want to keep holding Litecoin, great, that’s your prerogative. It has strong liquidity, and will likely remain pinned to 1% of Bitcoin’s price indefinitely. But if you hold it for its store-of-value properties, consider that there’s a new coin on the block that has such properties, and is on the verge of being widely recognized as such in the crypto community.
Bitcoin Rhodium currently trades on p2pbp2.io, WhiteBit, Trade Satoshi, Fat BTC, Sistemkoin and Bisq. If you have questions about anything XRC-related, including OTC trading, please email me at ahoffman@cryptogoldcentral.com, or DM/PM me on Twitter or Discord.