For some time now, Charlie Lee has been pushing Litecoin as a complementary crypto to bitcoin. He even said that Litecoin (LTC) could be a sidechain to Bitcoin (BTC). This is quite a unique strategy given that most other cryptos are trying to compete with bitcoin (BTC) by outperforming it in technical capabilities. The beauty of this strategy is that if Bitcoin succeeds, Litecoin (LTC) will succeed too. For instance, if Bitcoin were to hit a high of $50k, Litecoin (LTC) would probably trade at over $1000.
There are a number of factors that give Bitcoin such prospects. The first one is its network effect. Bitcoin is the most adopted crypto and is the first crypto that most people learn about when they first come to crypto. When coupled with the fact that it is scarce, there is no doubt that bitcoin will succeed. In fact, there is a high probability that it could hit a $100k in the future. In essence, it’s a smart move on Litecoin’s part to play a complementary role to bitcoin (BTC).
However, this comes with risks. One of the risks is that Bitcoin (BTC) is working on second layer solutions that are aimed at making it easy to use for everyday transactions. For instance, with the lightning network, Bitcoin (BTC) will be easy to spend, and this will make lots of altcoins obsolete. One of the altcoins that is at risk of going obsolete if Bitcoin second layer solutions succeed is Litecoin (LTC). Since it is positioned as a second layer solution for Bitcoin (BTC), there would be no point for its existence if the lightning network is implemented at scale on the bitcoin network. That’s a major risk to Litecoin’s strategy of aligning too much with bitcoin. There exists a possibility that Bitcoin (BTC) could gain tremendous success without necessarily pulling Litecoin (LTC) along with it.
On the bright side, Litecoin could benefit from the fact that altcoins tend to rally when bitcoin is bullish. This means that if Bitcoin turns bullish, chances are that Litecoin and all other altcoins would rally too. This would be a speculative rally that would see all cryptos rise as well. This was the case in 2017 and will most likely be the case in the next crypto Bull Run.
On top of that, Litecoin (LTC) is doing well for itself in terms of adoption. Litecoin (LTC) is one of the most adopted cryptocurrencies in the market after Bitcoin (BTC). This means that by the time bitcoin second layer solutions become a reality, Litecoiin will have established a strong market presence for itself, and this will anchor its value going into the future.
Besides, Litecoin (LTC)’s halving will be happening next year. If the history of Litecoin (LTC) is anything to go by, then it could be headed for a good run in 2019 and beyond. The risks are there, but the prospects of Litecoin look good going into the future. A $1000 Litecoin is very much possible in the foreseeable future.