Litecoin Foundation’s Project Director Makes The Case For LTC’s Network Effect

Litecoin Foundation’s Project Director Makes The Case For LTC’s Network Effect

Old faithful Litecoin turns 10 years old on October 7th. After a decade of activity, it’s still going strong. A faster and lighter Bitcoin fork, LTC’s objective has always been to be the silver to BTC’s gold. And this crazy year of high fees, Litecoin might’ve proved its worth. For many, it became the instrument of choice for sending money around without paying an exorbitant fee.

Our sister site, Bitcoinist caught wind of this development and reported:

Data compiled by @MASTERBTCLTC shows the number of Litecoin transactions is just under 75% of that of the number of Bitcoin transactions.

“Litecoin transactions are 75% of the total bitcoin transactions.
When will litecoin transactions flip bitcoin transactions?
Sometime in 2021 I predict.
227k BTC vs 168k LTC transactions.”

More significantly, @MASTERBTCLTC suggests this could be the start of an uptrend leading to a flippening in transaction count sometime this year.

We wouldn’t go as far as “a flippening in transaction count,” but it definitely is an interesting development that deserves further study. Luckily for us, Litecoin Foundation’s David Schwartz broke the case for its “network effect + ever growing status over the near past 10 years.”

Related Reading | Grayscale Loads Up On Litecoin, Dumps BTC & Other Coins, But Why?

Litecoin’s Transactions Are Cheaper And Faster 

This is by design. The cheaper and faster transactions are the reason for Litecoin’s creation. However, the case hereby presented is that LTC “has changed from mostly a method to transfer BTC during peak cycle to one of more ‘regular’/payment” and transaction usage. The asset seems to be changing.

When looking at trx volume vs. trx median value, you start to see how #LTC has changed from mostly a method to transfer #BTC during peak cycle to one of more 'regular'/payment trx usage.

Median $ value per trx is only $160.43 on 5/13/21, the same day it hit > $28 bln moved

3/ pic.twitter.com/gPqHTrwte2

— David Schwartz (aka – Dasch) (@DaddyCool1991) July 5, 2021

The Litecoin project boasts a decade of name recognition, it shows resilience and adaptability. While no blockchain is as busy as BTC’s, the LTC blockchain is far from a ghost town. It’s bursting with activity and ready for your transactions. There’s also proven liquidity in the market. Litecoin is basically a pristine asset, however redundant.  

Back to the metamorphosis, here we can see that “Transactions are well above average & growing exponentially each cycle.” Does that mean that Litecoin is becoming a payment instrument?

#Litecoin is 1 of only 4 #cryptos on Venmo & PayPal & 2nd only to #BTC in # of crypto ATM's sites globally.

It also boasts a comparable growth rate in overall, new & non-zero addresses with both #Bitcoin & #Ethereum w/o most of the marketing & news those two receive.

5/ pic.twitter.com/tmnNp0X5Wz

— David Schwartz (aka – Dasch) (@DaddyCool1991) July 5, 2021

The “comparable growth rate in overall, new & non-zero addresses with both” ETH and BTC is an interesting statistic. And the point about the lack of headlines LTC receives is well taken.

LTC price chart on Kraken | Source: LTC/USD on TradingView.com

Is LTC Undervalued? Is This a Buying Opportunity?

Obviously, David Schwartz has a vested interest in Litecoin. However, the case he presents has merits. A ten-year-old coin with new use cases is not something we face every day. In any case, as long as you know that this isn’t financial advice of any kind, we can keep exploring the case and doing our own research.

#LTC has been added to many global financial instruments & portfolios, with Grayscale's #Litecoin Trust being one of the most prominent. Yet, it's market cap has lagged in comparison to #BTC & #ETH

It did still exceed it's 2017 high of ~ $16 bln by $7 bln in 2021, though

6/ pic.twitter.com/63VWBei7Q2

— David Schwartz (aka – Dasch) (@DaddyCool1991) July 5, 2021

So, Litecoin is part of many financial instruments including a Grayscale Trust. Is the price reaction to that fact lagging or non-existent? Also, there’s a halving on the horizon and the always faithful hard cap or fixed supply. Plus, as we said in the intro, the number of transactions keeps growing. 

The picture Schwartz paints sure is interesting. The tide may be turning for Litecoin.

The last point is pretty compelling:

LTC also benefits from developments done by Bitcoin devs, requiring less full time direct devs unless necessary and less github activity.

By not trying to stand in Bitcoin’s spot and always knowing its place, Litecoin gets to benefit from all the incredible developments the Bitcoin community offers to the world. The activity around Bitcoin’s chain is second to none. Litecoin is a direct beneficiary of that. 

Related Reading | New Litecoin All Time Highs Are Still In The Cards

People used to say Litecoin was redundant but, if Schwartz is right, this classic coin might’ve found its lane. A decade later. What an inspiration. Now the question is, will the new status as a transaction asset reflect on LTC’s price? 

Featured Image by Alina Grubnyak on Unsplash - Charts by TradingView