The rate of newly issued Litecoin, the 12th largest cryptocurrency by market cap, has today shrunk in an event called “the halving.”
Just like Bitcoin, every four years or so, the supply of Litecoin rewards given out as mining rewards gets cut in half, meaning fewer of the digital coins are created.
The idea is to lower the rate of inflation on the network—fewer coins mean higher value per coin. In theory, this should drive up the price, if everything else about the network stays the same.
“Like gold, the premise is that over time, the issuance of litecoins will decrease and thus become scarcer over time,” a website dedicated to the event reads.
But so far, Litecoin—which trades as LTC—hasn’t experienced any bullish price action. Quite the opposite: The price of the coin is down 3.8% in the past 24 hours, trading hands for $89.02, according to CoinGecko.
Litecoin, which is a forked version of Bitcoin, wasn’t even faring well in the run up to the event, either—in the past seven days it’s down 0.6%.
Litecoin was launched in 2011 by ex-Google employee Charlie Lee. He wanted to create a faster, cheaper version of the biggest cryptocurrency and so he forked Bitcoin. That means he made a new cryptocurrency by copying and then changing its code slightly.
The objective was to make a peer-to-peer cash system cheaper than the oldest and most well-known digital currency. So far, the asset hasn’t been successful at beating Bitcoin in terms of adoption—but recently it’s made a somewhat comeback.
EDX Markets, a new, Wall Street-backed crypto exchange aimed at targeting institutional investors, listed LTC, along with Bitcoin, Bitcoin Cash, and Ethereum. The reason? It’s unlikely to be targeted by regulators as an unregistered security.
This led to the asset jumping in value and regaining a spot in the top 10 largest cryptocurrencies—again. But since then it has dropped back to number 12.
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Source: https://decrypt.co/151005/litecoin-third-halving-what-it-means-for-ltc
