Litecoin, a cryptocurrency that was created in 2011 by Charlie Lee is one of the coins whose price performance in 2019 is remarkable. It is even more impressive than Bitcoin, Ethereum, Ripple’s XRP, and Bitcoin cash. As at today, its $94.37 value is thrice its price in January 2019.
Litecoin Surges from $30 in January to $97 in April
Litecoin is the fourth largest cryptocurrency based on its market capitalization. On January 1, its price was around $30 with a market cap of about $1.9 billion. However, CoinMarketCap’s platform shows that Litecoin’s high for the year occurred on April 3 where the altcoin hit $97.50. Its market cap also rose to about $5 billion.
On the other hand, several reasons can be attributed to the sudden hike in Litecoin’s price which has recorded over a 200% growth since January. Some of the factors that have influenced its price include the halving set for August this year, the high adoption rate of the asset, as well as its low transaction fees.
Litecoin’s Halving Event Influences its Price Tag
While Bitcoin’s halving is set for May 2020, Litecoin’s halving will occur in August 2019. The aim is to lower the rewards (by 50 percent) that are obtained by miners and as such, it will help to reduce the supply of the coin in the market. The latter has caused many people to accumulate the asset since its a lower supply could bring about a higher price.
Declining Transaction Fees:
In comparison with Bitcoin, an increase in its price increases its transaction fees. However, Litecoin does otherwise given that its fees have been on the decline during the steady surge in price. For sending millions of dollars worth of Litecoin, one can even spend less than $1. An instance is a case in November where $62 million worth of Litecoin was sent for a fee of $0.50.
Faster Payments Using Lightning Network:
If you only thought the Lightning network (LN) can be used to send Bitcoin payments, then you need to have a rethink. Currently, LN can also be used to send Liteocin payments speedily and as such, it enables users’ transactions to be confirmed on time on the blockchain. With the use of LN, a payment channel can be created and left open to days, weeks, and months.
High Adoption Rate:
Reportedly, over 4,500 merchants adopted Litecon’s Lightning Network in February. It helped to foster the adoption of Litecoin and according to Litecoin Foundation, “tens of thousands [of] merchants worldwide and growing.”
Charlie Lee, Litecoin’s creator in February informed that Litecoin’s team of developers are considering the adoption of Mimblewimble protocol. The latter will make Litecoin transactions private while also bring about its scalability and fungibility.