The cryptocurrency market has now been in a bear cycle for more than
two-thirds of the past year, and, as August prepares to roll in
September, predictions from past months that the bitcoin price would
test its all-time high in 2018 appear less and less likely.
However, even after this prolonged decline, Litecoin creator Charlie Lee
says that the flagship cryptocurrency is still a good buy.
Speaking with CNBC, Lee said that the dropoff in prices has created an
excellent investment opportunity for long-term bulls who have cash-inhand
that they can afford to lose.
“It’s always good to buy on the way down to dollar-cost average your
buy-in,” he said. “As long as you don’t spend money that you can’t
afford to lose, I think that’s fine.
The former Google and Coinbase engineer cautioned against using
borrowed funds to invest in bitcoin, a practice that became disturbingly
common during last year’s fevered Q4 rally, noting that it’s incredibly
difficult to predict short-term price movements and bear markets can in
some cases endure for years.
He said:
“It’s hard to predict prices. I’ve been in this space for
seven years now. I think sometimes it comes back within
six months to a year, and sometimes it takes three or four
years.”
Lee further noted that, at present, cryptocurrency prices primarily
reflect speculative interest, not actual consumer adoption.
“It’s all about speculation these days, but, in the future, the price will
reflect the success of the currencies,” he said, adding that there has
been quite a bit of adoption this year even as prices have waned.
However, when asked if he would be buying back into litecoin (he sold
all his LTC back in December, citing a conflict of interest in having the
ability to swap price movements with his public statements), Lee said
no:
“I sold because of conflict of interest, so I’m not going to
buy my litecoins back anytime soon — or at all.