Litecoin up 30% ahead of fork, despite warnings of a scam

Posted: 15 February 2018 2:18 pm

shutterstock litecoin keyboard 738x410

Litecoin prices have been jumping in anticipation of a fork, despite clear warning signs.

Litecoin has seen a stark rise in the last 24 hours, with prices rising around 30% from $180 to over $230 in 24 hours. This might be partly down to the generally positive price movements around cryptocurrency, but Litecoin's rise has been especially pronounced even against this backdrop.

The reason for the rise might be the upcoming Litecoin Cash fork. At LTC block 1371111, due to arrive on Sunday 18 February, all Litecoin (LTC) owners will receive 10 Litecoin Cash (LCC). The main feature of Litecoin Cash is that it allows mining through the use of now-obsolete SHA256 bitcoin mining software.

It's possible that Litecoin is being bought up by speculators in order to receive a larger share of the Litecoin Cash.

However, Litecoin creator Charlie Lee has said that in his opinion it's simply a scam, and a worthless coin going for a cash grab. A CoinDesk analysis of current Litecoin trading patterns shows that its prices are being bolstered by high volumes on Coinbase's GDAX exchange. It has a reputation as a place for less experienced traders, and CoinDesk speculates that immature hype around the potential of free money in Litecoin Cash is driving up LTC prices right now.

Is Litecoin Cash a scam?

It's not possible to make a concrete judgment one way or another because the definition of a scam hits a grey area in cryptocurrency forks. While the Litecoin creator has called it a scam, he also considers Bitcoin Cash (currently the fourth largest coin by market cap, valued at $1,350) to be a scam. Is something still a scam if the people who "fall for it" make a lot of money doing so?

But the Bitcoin Cash fork arrived at a very different time, in a much less developed market, and had more valid reasons for being created. Litecoin Cash seems unlikely to go the same way.

All Litecoin holders will be getting their free LCC, even those who think it's a scam and want it to fail. The biggest Litecoin holders will get the most LCC, and will probably be the most eager to see it crash.

One outcome of the fork is that the value of Litecoin Cash will crash very quickly after release, as people race to sell off their new LCC as soon as possible while it still has some value. Those who are buying Litecoin now in the hopes of an LCC payday might end up disappointed.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

Latest cryptocurrency news

Picture: Shutterstock

Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VEN, XLM, NANO, SALT

Get into cryptocurrency

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.
Go to site