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Why is the premium rate of Litecoin so high (why has Litecoin failed to rise recently)

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Why is the premium rate of Litecoin so high

Why is the premium rate of Litecoin so high Litecoin is one of the Cryptocurrency with the highest listed value in the market at present, and its total circulation exceeds 1 million. Although its price has been fluctuating recently, it has not attracted people’s attention. So why is the premium rate so high? Because it is the most prominent form of mainstream digital assets such as Bitcoin. According to CoinMarketCap, since May, the price of Litecoin has risen from $3 to nearly $9. Although it fell by more than 90% when it reached the highest level in history on April 1, Litecoin still maintained an increase of more than 50%

Litecoin is an ERC-20 token based on the Ethereum blockchain, which is highly scalable, easy to use and decentralized. Unlike most other Cryptocurrency, the token is designed as an investment vehicle similar to the stock market. Due to its network effect (i.e. by incentivizing liquidity in the market), it enables traders to achieve higher returns. This mechanism can prevent users from using their funds to purchase and sell Cryptocurrency, which means they can exchange their assets without affecting their value. Therefore, even in extreme market conditions, LTC/USDT also has good price stability: if the premium of BTC/BNB is as high as 60%, its price may be 30% -40% higher than the premium of ETH/LTC

The total supply of Litecoin is just over 300 trillion, while the total output of Litecoin is only 21 million per day. According to today’s calculations, approximately $25 billion enters circulation each year, half of which comes from mining incentives; The other half comes from block subsidies and operating expenses, both of which indicate the market demand for Litecoin

In order to better understand these situations, let’s first look at some basic principles:

1. In the world of Cryptocurrency, ownership is publicly visible. Anyone can view or modify their holding records and verify them at any time. For example, when a person has a wallet address and wants to transfer the money to another address, their entire asset will automatically be converted into Bitcoin

2. Everyone must believe that the encrypted assets they hold must be meaningful. For example, if you put a Bitcoin into a specific number of wallets and it is destroyed, there will be no run on it. On the contrary, when investors store their money in cold storage, it immediately disappears. So you can assume that you have enough people to buy Bitcoin instead of selling it, and there won’t be any selling pressure for a period of time. In other words, as long as you control your encrypted assets, you can continue to make profits, whether you are willing to do so or not. In addition, if you want to earn interest on your encrypted assets, you need to have a “custody” service to provide assistance and eliminate risks

Why can’t Litecoin rise recently

According to CCN, why can’t Litecoin rise? According to data analysis by CoinMarketCap, LTC prices have fallen by about 30% in the past week since early August. Nevertheless, it still maintains a strong fundamental momentum. But if the price drops below the current level, there will be a very significant selling pressure – at least one of the situations that have occurred in the recent bear market. Recently, there has been another significant pullback in Bitcoin, which may indicate some bearish voices in the market.

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