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Litecoin buying power dropped like a light switch had suddenly cut all energy, and within hours it was approaching its Monday values once again.
On Saturday, the Litecoin market holdings were dropped like third-period French. In much the same fashion, the ultra-secure altcoin Dash has also seen a marked rise in trading over the weekend, stoking fears of an equally precipitous decline in the coming days.
As we reported on Friday, an alleged “Pump-and-Dump” scam was suspected for the Litecoin currency and its sudden meteoric rise. Advocates of the altcoins would remark that the Grexit is a factor in the sudden value spikes and has helped them, as it has bitcoin.
The hard numbers do not bear this out. For no particular reason, trading in Litecoin started to ascend last Monday from a value of US$4.77 to over US$8.50 on Friday. Nothing has changed in the Grexit situation over the past week to spark market sudden demand in altcoins, and the demand is not coming from Greece but from China. See the chart below for last week’s Litecoin price history.
Then, on Saturday, Litecoin buying power dropped like a light switch had suddenly cut all energy, and within hours it was approaching its Monday values once again. Looks like a textbook coordinated market dump by the players involved, the vast majority of the trading originating in China over the last week.
Makes sense. Who’s really watching the markets on Saturday? You could look at the chart and say ‘That’s just a coincidence,” and that is possible, but the problem is last week rumors forecasting the event of this exact “Pump-and-Dump” strategy were rampant (If you can speak Mandarin, this video may prove very useful).
Thus, this wasn’t exactly a secret. My article on Friday said a massive drop in LTC values shortly is very possible, and indicative of a set-up, and that came to pass the next day.
The clincher is the chart below. Almost to the hour, look at the wild increase in buying of Dash on Saturday, July 11. You don’t have to be Sherlock Holmes to see a less-than-subtle altcoin buying strategy taking place. A group of buyers suddenly wanted Dash to gain over 30% over the weekend. Fancy that. Where was the interest in Dash before Saturday?
There is a difference with how Dash is set up and how Litecoin works. The Chinese, or any buyer, do not have to dump Dash in a similar fashion. If you have 1,000 Dash coins, you can set up a Dash “Masternode” and earn more Dash coins every month. The cascading effect can generate more Masternodes as needed going forward. The Dash coins in the Masternode are off the market, increasing the price of Dash, and you will still own the coins in the Masternode to make money on as you wish, based on market conditions.
Could it be dumped like Litecoin was? Absolutely, but the investors have long-term options with Dash that are not available with Litecoin.
Comparing this altcoin movement to bitcoin is pointless. This is because bitcoin has moved consistently upward for one month and has seen increased buying interest in Europe, in particular, and worldwide, not just from the Chinese market.
The altcoins should actually be flattered that they would be used as an investment tool on any large scale, which seems to be a first. Usually, you have to have some established market presence and interest to experience currency scams and bubbles like this. Bitcoin (Mt. Gox), Gold, US Dollars, Silver, and real estate have all be inflated and manipulated before, by various private interests. Now, factions within one of the world’s largest markets cared enough about two altcoins to manipulate them into an investment scam. Welcome to the big time!
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