The gradual warming of financial firms towards cryptocurrencies, combined with investment from individuals and institutions, has paved the way for an uptick in Litecoin momentum in 2021.
Litecoin heading for the nextresistance
Litecoin has had a rough start. In late 2017, founder Charlie Lee reportedly sold his entire bag of LTC to focus on developing the project. Lee, of course, received a lot of criticism for his decision.
The founder, called Satoshilite on Twitter (a reference to bitcoin’s creator Satoshi Nakamoto), didn’t hold back and repeated it a year later:
I sold because by holding LTC I could do something to increase the value in the short term, but it is bad for the long term success of Litecoins. I didn’t want this conflict. I’ve explained this several times. If you still don’t understand, I can’t help you. Get out of here.
– Charlie Lee [LTC⚡] (@SatoshiLite) July 7, 2018
Interestingly, LTC jumped 5,000% in December 2017, although a market correction in 2018 has brought the price back to pre-jump levels of about $26.
The gradual warming of cryptocurrencies by large institutions marks a significant change in attitude from the last bitcoin boom in 2017. Last October, Paypal partnered with New York-based escrow company Paxos and announced that it would allow its users to trade cryptocurrencies directly from their Paypal accounts.
Square Inc, the financial services and payments company run by Twitter CEO Jack Dorsey, bought bitcoin shortly after for $50 million, a move that rewarded the company with a 10% increase. As for litechons (LTCs), Visa has issued an LTC-only Visa card that can be used digitally and physically in the United States.
All of these crypto adjustments work together to create a network effect, as crypto assets like Ethereum, Bitcoin Cash and Litecoin seem to be among the select allcoins that benefit the most. There are also more than 2,200 companies registered on Cryptwerk that currently accept LTC as a payment method.
This week, LTC ranked 8th most valuable crypto asset, with a market cap of over $14 billion.
The recent shift from financial firms to retail investors has been leaked. Litecoin is at an all-time high with gains of over 350% since September. While until recently it has struggled to break above the critical resistance level of $170, it is now breaking above this key level and moving up in the bull market to the next resistance level of $228.
The graph of the active address clearly shows the dynamics of long-term employment contracts in the second half of 2020:
Transaction history through early 2021 also shows steady growth in LTCs; this is a trend and not a one-time spike:
Institutional interest followed when last week Grayscale, the world’s largest crypto asset manager, acquired 6,987 LTCs, bringing the total value of LTC assets managed by Grayscale to more than $250 million. Institutional investments further strengthen the currency’s price because they are the result of rigorous research combined with calculated, data-based forecasts.
Lee’s initial downfall ended last weekend when Litecoin Foundation project manager David Schwartz proposed a public buyout for Lee in a tweet, noting that Lee had sold his LTCs at an average price of $205, which was now removed.
@SatoshiLite sold his #LTC stack for an average of $205.
Now everyone can shut up.
– David Schwartz (aka – Dasch) (@DaddyCool1991) February 13, 2021
What is your position on Litecoin – bullish or bearish? Tell us what you think in the comments below.
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