4.6 C
London
Sunday, December 5, 2021

Why People Fear Investing in Litecoin

Litecoin was launched in 2011 as a response and improvement upon bitcoin. In the ten years hence, it hasn’t quite taken off as bitcoin has managed to. There are a variety of reasons for this. Even so, Litecoin is still a digital asset which many investors have had their eyes on.

Now, you may have heard of reasons why it’s a great idea to invest in Litecoin. However, why don’t we do the reverse and tell you eight reasons why some people veer away from this cryptocurrency? Some of these reasons are logical. Others are harder to understand.

Either way, stick around to learn what they are. Before we dive into the content, please make sure to like, subscribe and turn on post notifications. Our content is always interesting and engaging, and you wouldn’t want to miss a single piece of content. Now let’s get started

8. Litecoin has Branding and Image Issues As the entire catalogue of available cryptocurrencies reel against the barrage of attacks from regulatory bodies, banks, governments and journalists, Litecoinis especially down bad in this regard.

Litecoin is the second most used cryptocurrency on the dark web, a hotbed for the worst criminal activity. Such statistics can cause established investors and banks to raise an eyebrow when Litecoin is involved. In addition, the developer team behindLitecoin hasn’t done enough to brand the digital asset in a way that is attractive to investors. Most people only have negative feelings about it.Others often confuse it with bitcoin.

7. Slow Growth Rate Despite being one of the first cryptocurrencies ever made, Litecoin has struggled to take off as bitcoin and others have. Sure, as the fifth most traded cryptocurrency worldwide, it isn’t doing too bad. However, given its age and functionality, there’s the expectation from investors that it would do way more than this.

Currently, Litecoin trades at around 170 dollars compared to bitcoin’s 40,000 dollars. To many investors, even those who play for the long term, this is disappointing. Many other cryptocurrencies are far more competitive and are capable of providing both short term and long-term gains.

6. Instability All cryptocurrencies are victims of the tides and fluctuations of the market. Even so, some are able to brace against price drops and recover way easier than others. Litecoin is in the latter category, lacking the X factor, which makes its price bounce back from sharp drops. In addition, it has been losing market cap rather than gaining it.

Though it peaked at number five around 2017, it is currently number 12. It is outperformed by other newer coins, even those that lack the same degree of security and functionality.

5. Uncomfortable with its Decentralized Nature Litecoin is decentralized in nature. Even though this isn’t unique to it as a cryptocurrency, it’s part of a big reason why investors are wary. Being decentralized means it’s out of the hands of the original developers. And so, in a sense, Litecoin no longer belongs to them and now belongs to no one. It being decentralized means that there’s no one to be held accountable regarding Litecoin.

Even though some traders love this nature, a lot of huge institutions like banks and governments are wary.

4. Environmentally Harmful Being technically similar to bitcoin, Litecoin needs to be mined in order to generate new units. This mining process is quite rigorous and environmentally taxing.The environmental impact of cryptocurrency mining is one of the reasons many investors have shied away from the marketplace. After all, the earth is in an environmentally precarious position, and many policymakers are trying to cut down on harmful human activities.

Although Litecoinmining hasn’t been affected so far, there’s no reason it won’t all come to a grinding halt the moment some new policies are put into place.

3. Investors are more comfortable with other coins There are about 200 cryptocurrencies in existence today. Many more are being developed as we speak.

...

With the competition being so tight, a lot of investors veer away from Litecoinbecause they think the alternatives are better. These coins may seem more attractive for a variety of reasons. Perhaps the coins have better functionality.

Perhaps they are more secure or less environmentally harmful. In any case, there are a ridiculous number of options for cryptocurrency investors these days. Other coins like Monero, Polkadot, Ripple, Chainlink, Cardano and Solana are all up for grabs. Some of these, like Chainlink, have a ridiculous amount of good branding. Others like ripple have a dedicated team behind it to help it develop. In any case, Litecoin is losing out.

2. Misunderstanding its CapabilitiesEsteemed investor Warren Buffet says one of the keys to his success is that he does not invest in technology he does not understand. Unfortunately, so many people have taken this the wrong way and veer away from any new thing. What Warren meant by this is that it’s best to read and understand all facets of an asset before putting your money into it.

Unlucky for Litecoin, where it is concerned, investors don’t want to do the research to understand what it is capable of and how it distinguishes itself from bitcoin and other stable coins.

1. Fear of Regulatory ActionThis is another reason that isn’t particular to Litecoin but to cryptocurrencies as a whole. As these digital assets have grown in popularity and gained increasingly large market shares, regulatory bodies may be looking to clamp down on them. Unfortunately, many of these cryptocurrencies are decentralized, making it difficult to target anyone team of developers to get them to reign in their product. However, this does not mean that the regulatory bodies are powerless.

They could always target the banks, crypto exchanges and internet service providers. And so, until regulatory bodies decide what to do with crypto, most smart investors are simply observing for the time being. So there you have it.

Eight great reasons why people fear investing in Litecoin.Of course, this doesn’t make Litecoina a bad investment. But watching out for some of these reasons won’t be a bad idea. Financial marketplaces have always been strange spaces to navigate.

When you factor in crypto, that strangeness goes up a notch. And so, nobody has all the answers. For all we know, Litecoincould is leading the charge in a matter of hours. As we come to the end of this content, we hope you have learned some key reasons why people fear investing in Litecoin.

Some of these reasons are hyper-specific, while some are common to cryptocurrencies as a whole. In any case, it’s good to judge these reasons so as to know if Litecoin could be a great investment for you. Otherwise, like the people whose mentalities are guided by these fears, you could also stay away. Is there some reason people fear investing in Litecoin you feel we may have missed? Please share your thoughts below.

Read More: 2 OF 5 SEC HEADS SUPPORT RIPPLE NOW!!!!

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Stay Connected

0FansLike
3,042FollowersFollow
0SubscribersSubscribe
- Advertisement -

Latest Articles