As Bitcoin hovers around $100,000, the entire crypto market is rejoicing with greens, which has sent the total crypto market cap past $3.5 trillion.
While BTC, much like always, continues to lead bull cycles, memecoins have emerged as the leading narrative, surpassing utility coins. This time, there are no whitepapers or litepapers to take a deep dive into the project’s value and understand the fundamentals.
Crypto’s run-up these past two years has been dominated by memecoin. A primary reason for this traction has been regular crypto users being fed up with backroom dealings where projects raise money from venture capitalists (VCs) by selling their coins at a really low price. These VCs then dump their coins on the retail after the project goes live, and the token gets an exchange listing.
But with memecoins, there’s no such shenanigans involved. With platforms like Pump.fun making it extremely easy for anyone to launch memecoins, everyone has to buy tokens in the open market and race to dump on each other.
There are no rules either; memecoins are simply an attempt to be lighthearted and attract a user base by promising a fun community while offering a really low entry point. They have no utility beyond this and tend to be highly volatile, even more so than the typical crypto.
Memecoins are simply cryptocurrencies representing animals, artwork, characters, or individuals. As a matter of fact, absolutely anything can be used for a memecoin. Actually, the coins that have been utility coins throughout your crypto journey have been switching into memecoins, too.
This is exactly what digital silver and Bitcoin’s digital gold, Litecoin (LTC), have done. On Nov. 14, this over-a-decade-old coin got renewed interest when the person behind Litecoin’s X (previously Twitter) account put this on social media:
The post came amidst the memecoin market cap reaching a new high, signaling a slow return of retail interest into the market. This was on the back of the listings of two popular memecoins, Pepe and Dogwifhat (WIF), and on major U.S. exchange Coinbase. Pepe, the frog coin that started the memecoin mania last year, was also listed on Robinhood, a leading brokerage platform popular among retail in the US.
So, with its humorous attempt to get the same attention that memecoins have been getting, Litecoin also jumped in on the trend. As can be seen from the response the post generated, Litecoin suddenly got a lot of attention, which helped its price gain traction.
The price of LTC surged more than 42% since that post as it moved past $106, a level last seen in early April this year. Crypto exchange Gate.io even listed it under the memecoin section.
At the time of writing, the 26th largest cryptocurrency, with a market cap of $7.34 billion, has been trading at $97.57 while managing $1.174 billion in 24-hour volume.
Still, LTC price is only up a mere 35.21% this year compared to other older coins like Bitcoin, which is up 133.35%, XRP’s 144.5% gains, ADA’s 79%, Tron’s 96.69%, and XLM’s 317% upside during the same period.
But then, there’s Ethereum, whose 52.66% year-to-date (YTD) performance has also been a disappointing one despite the second-largest cryptocurrency getting a Spot exchange-traded fund (ETF) approved.
While ETH is only 29% off of its peak, LTC is a whopping 76.3% away from its all-time high (ATH) of $410.26 hit in May 2021. The same trend can be seen in Litecoin’s open interest (OI), which surged to $472 million on Nov. 24, though nowhere near its last bull cycle peak of a billion dollars, as per Coinglass.
A Memecoin or a Utility Coin: Understanding Litecoin
Litecoin (LTC) was launched in 2011, only a few years after Bitcoin, by Charlie Lee, an MIT graduate and former Google engineer. It utilized Bitcoin’s source code but made changes to make it faster and cheaper.
Referred to as “the silver to Bitcoin’s gold,” the idea with Litecoin wasn’t to create a replacement for Bitcoin but to provide yet another blockchain to the developing crypto ecosystem, which is decentralized but has faster block generation. So, as a digital gold, Bitcoin acts as a store of value, while Litecoin, as a digital silver, is to be used to facilitate transactions.
Much like Bitcoin, Litecoin also experiences halving every four years. So far, it has had three, with the last one occurring in August 2023, which reduced the block reward from 12.5 LTC to 6.25 BTC. The next halving is expected to occur in mid-2027, which will bring its rewards further down to 3.125 LTC, which is Bitcoins’ current block reward following its most recent halving in April of this year.
But while Litecoin also has a proof-of-work (PoW) blockchain, it uses the Scrypt algorithm to Bitcoin’s SHA-256, making it less energy-intensive than the world’s largest cryptocurrency.
Despite having many benefits compared to Bitcoin, which has been garnering the attention from institutions and even nations as it gears up to be a reserve asset, Litecoin has been pretty much lost to irrelevance as the crypto sector continues to grow with more innovative projects and new narratives.
This was until Litecoin changed its tactics and jumped on the new trend. As the project stated in an X post, it was a lighthearted jab at the market’s state and a self-deprecating acknowledgment that despite being the “oldest and most reliable cryptocurrencies in the world,” their accomplishments have been largely unnoticed all these years.
So, while the LTC price has been rather limited, the Litecoin blockchain has been working just fine. In fact, the Litecoin network has achieved the milestone of processing 84 million transactions so far this year.
“$LTC is more active than ever!”
– posted Litecoin Foundation on X while sharing this achievement
Yet another development has been its hashrate, which has been experiencing a constant increase throughout this year. Currently, sitting around 1.4112 PH/s, the hash rate is near its ATH of 1.49 PH/s hit on Nov. 18, as per Bitinfocharts. The growing hashrate shows that more and more computational power is being contributed to the network in order to get a chance to successfully mine a block and earn rewards.
Then there are the short-term LTC holders, which are on the increase too. The number of such holders spiked over 30% in the past month as the token gained market attention, and traders and investors jumped to take advantage of the opportunity.
In an interview with CCN, David Schwartz, Director of Strategic Partnerships at the Litecoin Foundation, talked about Litecoin’s speed, affordability, and utility as its unique selling point that makes it a practical tool for everyday transactions.
Developers have also been working on offering Litecoin users optional privacy through MimbleWimble Extension Blocks (MWEB). This privacy feature enables confidential transactions without compromising the blockchain’s integrity, which, according to Schwartz, makes it appealing to those individuals and businesses that value financial privacy.
The average daily transaction activity for MWEB has tripled since July. But if this feature is incorporated by larger wallets, Schwartz sees it making “a significant difference in adoption.“
Besides adopting the memecoin trend, Litecoin has been keeping up with the market by integrating with DeFi. For this, the project introduced Wrapped Litecoin (wLTC), which enables the usage of LTC in the booming DeFi ecosystem. And now, Litecoin is seeing the potential to get its very own ETF, much like Bitcoin and Ether, which can supercharge its network metrics and market demand.
The Most Bullish Upcoming Event: Will it Materialize?
Spot ETFs have been the primary driver of Bitcoin’s run-up this cycle. The US Securities and Exchange Commission (SEC) giving Bitcoin Spot ETFs a green light sent BTC’s price up by 525% since Nov. 2021 low under $16K.
Since getting the approval, all the Bitcoin ETFs have recorded a total of $30.84 billion in inflows, achieving $107.5 billion in net assets, according to SoSo Value. BlackRock’s IBIT leads this Bitcoin ETF race with $31.33 bln in net inflows, followed by Fidelity’s FBTC, which captured $11.54 bln.
Then, in late July, Ethereum ETF got approved, which has so far only managed to gain $106.80 million in cumulative inflows. This is because Grayscale’s ETHE still leads in net assets at $4.95 bln.
With these approvals, the market is now trying to have institutions gain exposure to other crypto assets. In October, Canary Capital Group filed for a Litecoin ETF in addition to submitting documents for an XRP fund. However, the firm has yet to disclose the ticker or management fee for the funds.
The filing was just an S-1 document, which is the first step to getting a new security issued and listed on a public stock exchange. It needs to be followed by the 19b-4 filing for the S-1 filing to have any meaning. And once that happens, the SEC has to make a decision, under a strict timeline, to approve or deny the application.
Despite the move being primarily, LTC price spiked 5% on the news of the filing. Given that Litecoin had no token sale or pre-mining, its fair launch makes it a viable candidate for an ETF. The Spot Litecoin ETF, according to Alex Thorn, head of research at Galaxy Digital, “should theoretically have the same pathway” as Bitcoin ETF.
Already, there are several investment vehicles that give institutions a way to buy LTC. This includes CoinShares’ LITE and ETC Group’s ELTC, but both are in Europe. In the US, Grayscale remains the dominant force, which has several closed-end funds offering investment in various crypto assets such as Aave, Avalanche, Bitcoin Cash, Bittensor, Ethereum Classic, Filecoin, Horizon, Near, Solana, Stellar, XRP, Zcash, Stacks, and more.
Grayscale Litecoin Trust (LTCN) meanwhile has $180.74 in assets under management (AUM). The asset manager charges a hefty management fee of 2.50% on this fund, but it still accounts for the majority of the funds invested in Litecoin-related ETPs globally. LTCN was launched in 2018 and began trading on the OTC market over two years later.
While Grayscale has converted its both Bitcoin (GBTC) and Ethereum (ETHE) funds into an ETF, it hasn’t filed for an ETF for LTCN. However, last month, Grayscale filed to have its multi-token fund converted into an ETF. The Grayscale Digital Large Cap Fund (GDLC:OTCQX) covers BTC, ETH, XRP, SOL, and AVAX.
Despite all this, Litecoin creator Charlie Lee believes that Spot Litecoin ETF will get a green light from the regulator.
“I’m excited to see the Litecoin ETF filing by Canary Capital. We are definitely seeing a lot of institutional demand for Litecoin. This is clear from the daily growth of the Grayscale Litecoin Trust, which has a price that is over twice the NAV. Given that Litecoin is a commodity that is very similar to Bitcoin, I hope to see the Litecoin ETF approved very soon.”
– The Litecoin founder told Fox Business
A Litecoin ETF is expected to see LTC as a seriously investable option for traditional market players, who can use LTC as a way to diversify their crypto portfolio without needing to buy the asset itself. The digital assets-linked ETF applications, as per Lee, can help more people adopt crypto.
Much like Lee, Litecoin Foundation’s Schwartz also believes it to be a matter of when and not if Litecoin will get an ETF due to LTC’s value as a transactional currency. The approval, according to him, “could catalyze a broader recognition of Litecoin’s utility.”
Click here to learn if Litecoin can stand alongside Bitcoin (BTC) and Ethereum (ETH).
Here’s How to Buy Litecoin (LTC) in Four Easy Steps
Now, if all these factors that paint a bullish picture for Litecoin make you want to have an LTC bag, then here’s how you can get that.
The entire process of buying LTC is a simple one that’ll take as little as ten minutes. To get started, first get your phone or computer. It’s up to you which device you are most comfortable with.
Next, choose a cryptocurrency exchange. There are a lot of options out there, each offering a different feature and tool. While you’ll find that a vast majority of exchanges have listed LTC, we’d recommend using Kraken, Coinbase, Binance, KuCoin, Uphold, or Gate.io.
Once you have chosen the trading platform that you want to use, create an account by verifying your email address. You’ll also be required to verify your identity (KYC) by providing documents to prove your identity, address, and other details.
In the next step, make a deposit. To fund your account with fiat currency, you can make use of a debit card, credit card, and bank transfer. You can also deposit BTC and USDT, which are popularly available as trading pairs against LTC.
Then, simply use your funds to buy BTC by finding the coin on the platform, choosing your investment size based on how much you want to buy, and then clicking ‘buy.‘ You’ll find the purchased LTC in your exchange wallet.
Once you are ready to sell, depending on your financial goal, you can sell your LTC on the same platform using the ‘sell‘ button.
Click here to learn all about buying Litecoin (LTC).
The Road Ahead for Litecoin
As we saw, Litecoin has a lot of things working out for it. For starters, Litecoin has been in the market for over thirteen years now, which makes it one of the oldest coins. This longevity factor is further supported by the growing miner activity, transaction volume, and user addresses.
Built to be complementary to Bitcoin, Litecoin’s accessibility and reliability can help it get the market’s attention and gain adoption. So, as BTC hits six figures and retail feels priced out, they may even turn to LTC as a cheaper option. Notably, Litecoin has a fixed supply of 84 million. So, a continued increase in its demand can help its prices elevate substantially.
The potential of an ETF presents yet another big tailwind for Litecoin. Depending on the institutional interest and capital flow it sees, LTC price can see an upside. Then there’s the mainstream attention that old coins like XRP, ADA, and XLM are getting, which forecasts good things for Litecoin, too.
Add the memecoin trend LTC has onboarded and the mind share it has been getting, thanks to the voice behind its X account, and LTC can enjoy good momentum.
Retail interest in meme coins also has a long way to go. “A strong indicator of retail interest,“ memecoin activity is still low compared to that seen during the previous peaks of most memecoins, noted IntoTheBlock, adding that this divergence from the total memecoin market cap hitting new highs “suggests retail enthusiasm hasn’t fully re-entered the crypto space yet.”
The broad crypto market has certainly started the party, though, with BTC ready to blast through $100K, driven by both strong spot demand and institutional inflows. With President-elect Donald Trump’s win, the most crypto-friendly administration ever, prices are expected to climb much higher.
So, against this backdrop, Litecoin can potentially rise to new heights, which, unlike the last cycle, can actually be much higher than the 2017 peak if the coin is able to capture the memecoin and ETF trend well in this bull market!
Click here to learn all about investing in Litecoin.
