The popular, and sometimes controversial stablecoin Tether (USDT) has surpassed Litecoin (LTC) as the seventh largest virtual currency in the market. Cryptocurrencies have been falling during the last months due to a bear market that started earlier this year.
Litecoin is one of the most popular virtual currencies available since it was launched back in 2011 by Charlie Lee. At the end of 2017, Litecoin reached its all-time high of $350 dollars and fell down to $28 a few days ago. Of course, Litecoin is not the only crypto that was affected by the bear market. Most of the cryptos available experienced a similar situation.
Litecoin has usually followed Bitcoin’s price movement. Bitcoin lost around 80% of its price since the beginning of the year, thus affecting Litecoin’s valuation as well. Litecoin’s creator, Charlie Lee, is also one of the most important figures in the cryptocurrency world. Nevertheless, earlier this year, Charlie Lee announced that he sold his Litecoin because he wanted to avoid conflicts of interest.
This has also affected Litecoin’s price and the credibility of Mr. Lee that now does not have a stake in the game. Additionally, Lee has also warned investors that they should always invest in what they are able to lose and that Litecoin could go down to $20 dollars, which is not far from where we currently are.
Tether has also captured the attention of the crypto market for the whole year. Why? Because it has been involved in different controversies regarding the funds used to back each USDT and because it was accused of being used for manipulating Bitcoin prices during bear markets.
It is important to remember that each USDT is supposedly backed 1:1 with the U.S. dollar that is held in reserve by the company Tether. But the company has changed bank and also experienced scrutiny from the crypto community regarding its funds.
At the time of writing this article, Tether has a market capitalization of $1.84 billion and Litecoin $1.76 billion. Each Litecoin can also be purchased for almost $30. In this way, USDT is the 7th largest virtual currency in the market, and it is getting close to EOS that has $2.03 billion market cap.
The only way USDT has to improve its market capitalization is by increasing the supply that the currency has since price swings are very rare or just marginal.