Mike Novogratz, renowned trader and famous bitcoin bull said that he does not believe that the Litecoin price will sustain its dramatic early-week rally and he would “sell it here.”
What is Litecoin?
One of the several clone cryptocurrencies that stemmed from Bitcoin, Litecoin “forked” off the Bitcoin ledger in late 2011. It was intended to be the silver to Bitcoin’s gold: a faster, more lightweight version of the Satoshi Nakamoto-created cryptocurrency. Instead of the approximately 10 minutes, it takes for a Bitcoin transaction; a Litecoin transaction only takes 2.5 minutes.
While making transactions four times faster, Litecoin’s creator also Charlie Lee quadrupled the maximum number of coins that can be mined. While bitcoin has a total of 21 million, Litecoin totals 84 million. And the total market value of Litecoin is currently lower: $18 billion to Bitcoin’s $291 billion. It is the fourth largest cryptocurrency market behind Bitcoin, Ethereum, and Bitcoin cash.
The higher number of Litecoins, meanwhile, could make it psychologically more attractive to buy small-ticket items using the cryptocurrency.
Novogratz, the founder of crypto hedge fund Galaxy Investment Partners, stated in a talk with CNBC that, despite the fact that bitcoin represents a buying opportunity for the investors even after its fourth-quarter rally, he does not think that it will happen the same about the Litecoin.
“I don’t think [the Litecoin rally] has the same legs as bitcoin,” he said. “I’d sell it here” and buy bitcoin.
During the last week, the price of Litecoin has been raised more than three times, and on cryptocurrency exchange, GDAX has briefly crossed $400. Currently, the Litecoin price is trading at a global average of $336, making it as the fifth-largest cryptocurrency by the total market cap.
Novogratz ascribed the rally to an “agile promoter” and boost around lightening network technology, which is expected to be amalgamated into both Bitcoin and Litecoin. It is expected to be Charlie Lee Litecoin creator who has made several high-profile media appearances this week he has mentioned.
Another theory is that Coinbase users are buying Litecoin. Most of the Coinbase Users are new to the cryptocurrency markets.They are buying the Litecoin because it appears “cheap” compared to bitcoin and Ethereum, the other two cryptocurrencies offered on the brokerage platform.
Novogratz said that Litecopin rallies and other rallies are the byproducts of the industry’s “speculative mania,” as well as the fact that none of the protocols, even Bitcoin, are ready for “prime time.”
He said that “This is what a speculative mania feels like. We are in the middle of a speculative mania, and phase one of this whole decentralised revolution is just selling the story. None of these protocols is going to be ready for prime time for at least two to three years, so we’re selling the story of what the future is going to be”
Novogratz is quick to acknowledge that his bets have been wrong before. Although he called bitcoin’s climb for $10,000, he believed that achievement would trigger a selloff. As a result, he sold some of his belongings, waiting to buy back in following an immerse that never came.
He said that “Cost me a fortune”.
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