Crypto Hedge Fund Says "Short Litecoin"

in crypto •  6 years ago 

A cryptocurrency hedge fund says they are short litecoin, and you should be too.

Multicoin is a cryptocurrency focused hedge fund that fails to see the need for litecoin, at least at these prices, in the cryptocurrency universe.

They went ahead and laid out a multitude of reasons why they think that in their new report here:

https://multicoin.capital/2018/09/14/debunking-market-narratives-litecoin-ltc-edition/

The report was written by managing partner Tushar Jain.

Why exactly do they think that?

I won't go into all the details as to why they think litecoin is a good short, but I'll give you the brief overview.

By the way if you do want all the specifs feel free to read the report I linked above or check this out:

https://www.ccn.com/litecoin-a-significantly-overvalued-relic-cryptocurrency-hedge-fund-claims/

Basically, their main thesis is that there is no real need for litecoin going forward.

When it was originally created it was supposed to be the payment coin while bitcoin was the store of value coin.

Bitcoin could be digital gold and litecoin could be used for every day transactions, that was the theory at first.

However, now that the technology around cryptocurrency as a means of payment has drastically been improved upon by smart contracts (among other things), litecoin finds itself in a very strange spot.

It is too slow and too expensive, not to mention it wouldn't really scale, to be used as a primary means of exchange.

It is also not likely to be seen as a very good store of value when you have its older brother bitcoin doing that quite well itself.

What exactly is litecoin good for?

That is the entire thesis behind Multicoin's bear case.

Some other minor points were that litecoin benefited from being one of the few coins listed on Coinbase as well as riding the entire asset class wave up in early January.

Things that are not likely to put a bid under the price of litecon any longer.

While some say litecoin at $50 is cheap, Multicoin says short it now, today, and you will make money.

(Source: https://www.ccn.com/litecoin-a-significantly-overvalued-relic-cryptocurrency-hedge-fund-claims/)

Short and distort?

By the way, isn't it a great world we live in where we can bet against something and then spread all kinds of negative info and news about said thing hoping to get others to go along with our trade as well?!

I am not sure about you, but to me that sounds like the very definition of market manipulation.

I guess when you do it to drive crypto prices down it is ok, but when you do it to drive them up, it is not ok.

I think I understand now.

(Sarcasm font on)

Stay informed my friends.

Image Source:

https://www.ccn.com/litecoin-a-significantly-overvalued-relic-cryptocurrency-hedge-fund-claims/

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Steem or Nano is better form of every transaction curency given its feeless nature.

Posted using Partiko Android

Correct. Plus it is much faster and it scales significantly better.

I agree! I still think Litecoin will have it's place among the top cryptos though

Why do you think that?

I think with the Litecoin Foundation's 9.9% investment in WEG Bank AG earlier this summer they are positioning the currency to be a strong competitor in the re-configured blockchain based banking industry. Most people in crypto want the banks to disappear but I see them as a necessary partner to help bridge the gap between those of us who are not scared of this thing called crypto currency and those who are.

This crypto space is nothing vlose with rational as always. What is better in term of tech doesn't always reflect on the price. While LTC maybe lag behind those feeless coins, it has its own advantages as well.

Yes that is true, for now. It won't always be that way and I would bet it is going to change very soon to be honest. Big money doesn't stay dumb for very long.

Steem is honestly quite revolutionary.

Posted using Partiko Android

it is a better coin compare LTC..

It is news like this that will keep crypto from going legit into the mainstream of investments
😩😩😩😩😩😩

Why is that?

Bad news! Litecoin is a quality product.

Posted using Partiko Android

I actually somewhat agree with them. I am failing to see how exactly it fits going forward.

  ·  6 years ago (edited)

Just a mere copy of LTC, launched as a joke DOGE survived and is flourishing due to strong community. STEEM on the other hand not only a top notch cryptocurrency by developments and technology, it is building strong HODLers community. In near future it will definitely rank above DOGE and LTC as @jrcornel stated "Big money doesn't stay dumb for very long."

This is the sort of news that comes out when a bottom is close... I think its too late to call something overvalued as Litecoin has come down from almost $400 to $50. While they have considered real factors that can impact Litecoin, the same can be said about many other cryptocurrencies. However, I think Litecoin is one of the fee that have a well distributed community of developers (and foundation) that are actively seeking ways to improve adoption. I still visualize Litecoin as a better asset to use for exchange/payments that bitcoin and its still cheaper. However, if we get increased transactions in BTC like we recently saw in ETH, Litecoin will still be better.

Only if bitcoin stays in its current form. However, that likely will not be the case. At some point in the future, bitcoin will still be a very good store of value, plus it will be used for payments with upgrades such as the lightning network. Not sure where litecoin fits in that world. If you are a one trick pony, like is the case with litecoin, you better be the best and litecoin isn't anywhere near the best now that smart contracts are around.

I actually agree too.

Litecoin isn’t the best at what it does and will likely die a slow death. Crypto with feeless transactions will win out for payments in the end and as Bitcoin gets faster/cheaper, it’s status as the store of value king will remain.

Posted using Partiko iOS

Yep, my thoughts as well. Well said.

Litecoin is an awkward position indeed, however it will still benefit from being one of the more prominent projects. I can't see institutions investing heavily outside of the top 10 projects by marketcap tbh, not while the industry is still so young.

  ·  6 years ago (edited)

Well currently they aren't investing at all. When they do, it will just be bitcoin to begin with. Aside from them, there are hedge funds and VC funds that will look for real projects that have real potential. Litecoin won't get money from either groups.

The function of litecoin is being a backup for bitcoin. If digital gold fails, digital silver steps in. That's one of the advantages of currency competition. But I agree there are better coins out there. Personally I'm a big fan of DAG coins (minus IOTA), but for some reason they have trouble getting adopted.

Wouldn't BCH be the backup for bitcoin at this point? Either way, if bitcoin were to fail I highly doubt another POW coin would take it's place. If bitcoin fails, all the POW coins in their form would likely fail as well.

usually do the opposite the say short ltc means they wanna buy it on the cheap. Personally I think btc maximalist is a good place to be given the market but if you want those big returns you got to take risks.

Not in this case. They short at a higher price and they need more and more people to sell in order to make their bets more profitable. Not sure how this isn't market manipulation though.

  ·  6 years ago (edited)

They want to short squeeze whomever adheres to their official "opinion".
A typical Peter Schiff-Marc Faber-Mike Maloney-Jim Sinclair-Bill Holter tactic.
Both bitcoin and litecoin are obsolete and still have more downside, but to start to short LTC now is less wise than it was before.
A down cascade is what multicoin's "opinion" relies upon, and it is speculative since another asset bubble may be on its way.

Well, even at $55 litecoin is still worth over $3 billion, still a lot of cheddar to be made if litecoin is indeed mostly without a use case going forward like they claim.

Not sure I agree with bitcoins obsolete for people to want to pay $6200 for a 1 btc tells me it's very much alive I remember $620 a coin not that long ago and the network is still only getting stronger.

The main reasons to Bitcoin's soar were Chinese trying to rescue their labor's income from China and the Tether scam (fractional reserve banking by a larger multiplier than in fiat).

The Tether "scam" was never proved by the way. In fact one might even argue there is just as much evidence against it being a scam as there is for it...

What evidence is there against the claim of a scam?

  ·  6 years ago (edited)

Well the fact that they got a former FBI law firm to sign off on them having more than enough money in the bank to cover all tethers is a big one. Then you have multiple unrelated exchanges, including kraken saying there is nothing nefarious going on with tether in the crypto ecosystem. Then you have the fact that multiple very wealthy people/entities have chosen to do business with tether, and you would imagine they would have looked into it a bit before they put hundreds of millions into it... not to mention it is still operating despite a CFTC investigation as well as all kinds of negative press. If it was a scam one could reasonably assume it would have been shuttered by now. And these are just to name a few off the top of my head.

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  ·  6 years ago Reveal Comment

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  ·  6 years ago Reveal Comment

I'm not convinced by the tether scam either as most exchanges accept it, with more adding it all the time.

The only evidence I see of any thing here is self upvoting lol

  ·  6 years ago (edited)

Haha nice one! Yea I mean there has been so much talk about it and investigation already, I would think that if there was as big of a scam going on there that some of these people think, it would have been shuttered by now. Though perhaps I am just giving authorities too much credit?!

Also much of bitcoin's trading was done in dollars in late 2017 and early 2018. That tells me that bitcoin is much more than just an Asia story or China story like it was in the past.

The Chinese wanted to convert to dollars, so how could much of bitcoin's trading not be done in dollars in late 2017 and early 2018?

Much of the buying was done in dollars...

For every seller there is a buyer.

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any references to back up your claims? btc is prone to hype cycles which is what caused the high price everyone was talking about it and rushing to buy cryptos even though bitcoin didn't make sense with the fees at that time

I agree. Boom and bust cycles are par for the course with bitcoin. It's not going away. Institutions will only buy bitcoin when they first enter and they will be the next main value drivers for crypto. Bitcoin is likely the safest bet of anything that currently exists.

The hype was marginal compared to the factors that I mentioned.
You think it was so big because you are where it gets promoted.
The Tether scam:
https://steemit.com/cryptocurrency/@fortified/re-fortified-brock-pierce-or-is-billionaire-bitcoin-board-member-founder-of-tether-and-alleged-pedophile-a-covert-cia-asset-20180118t181617300z
About the Chinese I heard it in one of Martin Armstrong's interviews.

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Litecoin has its place and thats not changing. The lows have basically been hit so I would not short litecoin or any of the top coins at these prices.

Why is that not changing?