Flipside Daily Mover: LTC
A coin per day, making big moves
LTC Fundamentals Slip Amid Funding Woes
September 3, 2019
LTC FCAS declined -2.47% over the last 7 days, impacted by a 38-point (-5.82%) drop in Developer Behavior. User Activity climbed 1-point (0.11%) and Market Maturity spiked 2-points (0.25%). Price is down 8.09% over the 7-day period.
Rough Seas
After lackluster price performance following its August 5th halving, Litecoin has continued to face headwinds as news emerged last week of pay cuts for the Litecoin Foundation. Q1 was a particularly tough stretch for the foundation, hindered by a protracted crypto bear market. Designed to be self-sustaining through donations and partnerships, the foundation currently depends on funding from Litecoin founder Charlie Lee to remain operational.
In the second week of August, Lee was forced to publicly address a growing narrative that Litecoin development had stalled in 2019. While his explanation was effective in explaining the development cadence for the Litecoin core and how it lags Bitcoin core, overall development output has indeed slumped through the year including both Code Contributions and Community Involvement FCAS sub-metrics. Of less concern, is the overall LTC hashrate, which has declined more than 33% since the halving. Although this is expected due to the decline in block rewards, it will be interesting to see if it recovers through the coming months.
🌶️ Hot Take
While it may be disingenuous to draw direct correlations between the decline in development, financial woes for the foundation, and poor LTC market performance, the team is certainly facing a barrage of challenging circumstances. From a positive perspective, LTC overall Network Activity has remained strong, as the asset benefits from high liquidity, visibility, and a growing number of high-profile partnerships.
These high-profile partnerships with the Miami Dolphins, Glory Kickboxing, and the Mammoth Film Festival, among others, have done well to raise Litecoin awareness but have fallen short from a revenue perspective to support the current Litecoin business model. This struggle underscores general business challenges across the industry, as teams work out unique funding models and the transitions from centralized entities to foundations. Still, there is little doubt that Lee and team will remain diligent in supporting the Litecoin Foundation while driving LTC adoption forward.
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