‘Boring’ Litecoin makes play for top 10 amid market meltdown

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Lite­coin has been climb­ing the cryp­to mar­ket cap rank­ing and cur­rent­ly stands at rank 15 with a mar­ket cap of  as of press time.

Mean­while, the shake-up sees Solana move in the oth­er direc­tion, slid­ing from its top 10 posi­tion at the end of Octo­ber to place behind Lite­coin at 16th.

On Oct 30, Lite­coin was lan­guish­ing in the 21st spot, sand­wiched between Cos­mos and Chain­link. How­ev­er, recent events have turned the cryp­to indus­try upside down, with some com­men­ta­tors warn­ing that the FTX con­ta­gion is yet to run its course.

Crypto market meltdown

On Nov 17, new­ly appoint­ed FTX CEO John Ray made the first Chap­ter 11 bank­rupt­cy fil­ing, say­ing nev­er in his career has he encoun­tered “such a com­plete fail­ure of cor­po­rate con­trols and such a com­plete absence of trust­wor­thy financial infor­ma­tion.”

Ray paint­ed a grim pic­ture for cred­i­tors, say­ing he had no con­fi­dence in the finan­cial state­ments due to the lack of cash man­age­ment sys­tems and poor report­ing mechanisms.

Since Nov 7, the total cryp­to mar­ket cap has seen $248.6 bil­lion of cap­i­tal out­flows, leav­ing token prices reel­ing from the dis­as­ter. FTX-relat­ed tokens have seen the most sig­nif­i­cant draw­downs, with the native FTT token sink­ing 93% in val­ue to drop out of the top 200.

The price of Solana has also suf­fered due to fears over its expo­sure to the FTX col­lapse. Mes­sari point­ed out that the upgrade keys for Serum, a sig­nif­i­cant com­po­nent of the SOL ecosys­tem, were held by FTX. Sim­i­lar­ly, doubts emerged that Sol­let BTC (wrapped Bit­coin issued by FTX) was 1‑to‑1 backed.

On a more intan­gi­ble note, with FTX caput, SOL investors are also con­cerned that a sig­nif­i­cant backer is no longer sup­port­ing the project.

The market looking for stability in Litecoin

The chaos of recent weeks has exposed an indus­try hell­bent on unac­cept­able risks, espe­cial­ly regard­ing the col­lat­er­al­iza­tion of exchange tokens.

Lite­coin was released in Octo­ber 2011, mak­ing it one of the OG cryp­tocur­ren­cies along­side Bit­coin. While the likes of Name­coin, Feath­er­coin, and Peer­coin, to name a few, have fad­ed into obscu­ri­ty, Lite­coin has stuck around.

This longevi­ty has not gone unno­ticed; LTC’s resur­gence is like­ly a symp­tom of cryp­to users look­ing for sta­bil­i­ty in a chaot­ic mar­ket. The Man­ag­ing Direc­tor of the Lite­coin Foun­da­tion, Alan Austin, thinks so, last week he tweeted:

Sim­i­lar­ly, as the SEC secu­ri­ties con­tro­ver­sy con­tin­ues to play out, Bit­coin max­i­mal­ist Michael Say­lor recent­ly stat­ed that Lite­coin is like­ly a commodity.

“Some­one might file an appli­ca­tion to get Lite­coin des­ig­nat­ed as a dig­i­tal commodity.”

LTC wallets are on track to outnumber Ethereum wallets

On-chain data shows the num­ber of Lite­coin wal­let address­es con­tin­ues to grow steadi­ly. At the start of the year, the num­ber was approx­i­mate­ly 117 mil­lion wal­lets. Cur­rent­ly, there are around 162 mil­lion LTC wallets.

Litecoin wallet addresses
Source: Glassnode.com

Mean­while, the num­ber of Ethereum wal­lets at the start of 2022 was around 140 mil­lion wal­lets. Cur­rent­ly, the fig­ure is 166 million.

Ethereum wallets
Source: Glassnode.com

If this trend con­tin­ues, the num­ber of Lite­coin wal­lets will exceed Ethereum wal­lets by the end of the year.

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