Litecoin Price divorce Bitcoin as its Slump Continues
Litcoin no longer Silver to Bitcoin’s Gold
Litecoin, the once silver to bitcoin’s gold, is experiencing its worst ever price slump. For a while now, Litecoin price has been linked to that of Bitcoin. When bitcoin rallied in 2013 to trade at over $1,000, Litecoin rallied to peak at $40. Later, as the price of bitcoin plunged, litecoin price also experienced the same effect. This made the cryptocurrency community to believe that the two currencies were attached to each other.
However, if what has been happening in the past two months is anything to go by, this linkage is in shambles. Unlike in the past when Litecoin would step where its golden sibling had stepped, now the two digital currencies are sailing in opposite directions.
Bitcoin begun recovering in April and has since rallied to trade above $600. The same cannot be said of Litecoin. In fact, the second most valuable digital currency by market capitalization has lost value with the worst ever plunge being the one witnessed on July 1. For the better part of the period between April and now, Litecoin traded between $12 and $9. From mid-May, Litcoin has seen its price flit around around $10, but by mid June it fell below $10.
On July 1, just a day after the Silk Road Bitcoin auction winner had been communicated to, Litecoin experienced its worst ever plunge, losing about 10.1% in less than a day. Perhaps you would say it suffered the aftermath of Bitcoin auction. But this wouldn’t be the reason as bitcoin price surged. Litecoin continues to weaken, failing to reap the benefits of its golden sibling’s rally.
Causes of Litecoin’s Plunge
Litecoin, which is the second most traded cryptocurrency, is facing doubts over its viability. While what’s happening to Litecoin is not new in the cryptocurrency world, experts are struggling to pin down the reasons why currency has severely crashed. Many have pointed fingers at Bitcoin’s recovery.
Experts argue that the recovery of bitcoin has lured many cryptocurrency investors leaving the Litecoin community hollow. Perhaps this is true, considering the fall appears as though a colossal amount of investment has been carted off.
If any investor had put in huge investment in Litecoin with the hope that it could surge as Bitcoin did last year, then the investor must has every reason to withdraw his investment. The currency is struggling to impress.
About 30,000 More Introduced into the Bitcoin Cycle
On Monday, June 30, US Marshal Service was to communicate to the Silk Road Bitcoin auction winner. Interestingly, USMS has said that the auction was won by one anonymous bidder. The bidder took the entire stash of about 30,000 bitcoins. Despite the introduction of these bitcoins into the bitcoin cycle, the virtual currency has not lost a penny of its value. In fact, its price has continued to rise. By now only Second Market, among the 45 bidders, has said it lost. So who won the auction?
As the events unfold, it is becoming apparent that litecoin is now on its own. It is no longer in relationship with bitcoin, and this is hurting it badly. And in all these, there is only one question that linger, was Litecoin truly silver to bitcoin’s gold?