Litecoin founder Charlie Lee has recently added his views on the industry’s status quo, suggesting that both volatility and storage are key areas hampering a more widespread adoption of digital currency.
The one-time Coinbase Engineering Manager and Director of Engineering turned Litecoin Guru claims that there is clearly a Catch-22 scenario hampering cryptocurrency’s volatility, although Bitcoin is currently experiencing a long run holding its own. Lee sees the volatility of crypto markets and its usability showing a clear correlation, suggesting:
“Because crypto prices are so volatile, it’s hard for people to actually use it, meaning adoption is hampered. Volatility is kind of a chicken and the egg type scenario. Once there is adoption, volatility will decrease, meaning more adoption.”
The upside to this, Lee argues, is at least the tendency for startups to work on new projects without the perpetual focus on cryptocurrency prices, which he feels distracts for the process of focussing on further development within the industry.
Lee sees storage as another key issue with many investors turning to exchanges to store their digital assets, many of which have been subjected to well-publicized hacks, further damaging user confidence. Also, a recent study from Kaspersky revealed that only in the second quarter of 2018, cybercriminals scooped USD 2.3 million via crypto phishing during initial coin offerings. None of this engenders confidence, particularly in inviting new users.
The Litecoin founder views the current bear market with a degree of optimism, maintaining that investors have far more certainty that the market will come back than during the last bear market, when there seemed little hope for an upturn in market fortunes. With a note of realism, Lee sees another year passing with more sell-offs before a turnaround, although he admits predicting the cryptocurrency market is a thankless task. Lee’s last word on where the market should be going:
“Next is supporting crypto companies with bank accounts. Then, lastly, you want to add crypto wallets, along with storing fiat in normal accounts for crypto companies. What would be cool is allowing people to store US dollars at a bank and cryptocurrencies too.”
Lee once famously advised that all cryptocurrency traders, investors, and enthusiasts own at least one Bitcoin before buying any of the thousands of different altcoins. Whether that still includes Litecoin is a question that would be interesting if put to the crypto entrepreneur in today’s market.
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