The 24-hour Litecoin trading volume is edging close to overtaking that of Bitcoin, as traders and developers investigate alternatives to BTC's backlog, while fears of a pump and dump rise.
Following a 24-hour jump of 21.21%, Litecoin sits at only US$800,000 of trading volume away from overtaking Bitcoin as the most traded digital currency in July 9 trading. The volume has quadrupled in the last week to its current US$40M figure. On July 2, 24-hour trading volumes stood below US$10M.
Speaking to CoinTelegraph, Litecoin founder Charlie Lee detailed some of the technical differences that may now be enticing distributed ledger-dependent companies to switch over to a more agile digital currency. Lee described in a previous interview how he tackled the issue of spam transactions for Litecoin, explaining:
“The fix implemented in Litecoin is just to charge the sender a fee for each tiny output he creates. For example, in this specific attack, the sender is charged one fee for sending to 34 tiny outputs of 0.00001 BTC. With the fix, that fee would be 34 times as much. So it would cost the attacker a lot more to perform the spam attack. The concept is fairly simple: the sender should pay for each tiny output he/she creates.”
You can read CoinTelegraph's full interview with Charlie Lee, with further insight into the rise of Litecoin, here.
One theory behind the spike in the volume of Litecoin trading is that companies dependent on Bitcoin as a distributed ledger are hedging against the current mining backlog affecting the digital currency, and are switching, or trialing, alternatives.
Users on /r/litecoin were bracing themselves for a roller-coaster ride however, with some announcing they had already sold their holdings in fear of a impending price correction. User Wrongel took to the message board to discuss their decision to get out of the digital currency while the price was still rising, explaining:
Nah I can get only so many heart attacks a day. Sold around 0.026 something. After more than a year of looking at 90% loss, I can live with 40% gain, no rugrats lol.”
The fears are founded in the opinion being voiced by some commentators that the sudden upswing in volume could be a sign of a “pump and dump” in action.
With the rate of the price increase now appearing to slow, it may be only a matter of hours before fears of such a scheme are either confirmed or denied.