Despite the collapse of crypto markets in 2019, the Litecoin network still saw massive usage which brought its yearly trading volume to over $100 billion.
The use of Litecoin lower in 2019 than the year before
According to recent data provided by Bitinfocharts, last year saw as much as $100 billion in transactions on the Litecoin network. The amount is still lower from the yearly volume of 2018, although this is mostly due to the bull market that was still raging in January 2018.
Before the bear market kicked in and the prices started to drop, each day brought over $5 billion in transactions. On the other hand, in the first half of 2019, daily transactions — on average — saw only $200m -$300m.
Even so, 2019 was a pretty eventful year for Litecoin. The project saw its second halving last year, which further increased its network’s speculative activity. Ignoring this data due to it not being in accordance with the market conditions at the time, makes the roughly equivalent value transfer between the two previous years.
It also draws a further conclusion that the level of interest among non-speculative participants of the network has grown at its base. In fact, the base appears to be quite strongly formed around $100 million in transactions per day, on average. Meanwhile, the number of transactions themselves sits at around 21,000 per day, on average.
This would mean that each transaction, once again – on average, has comfortable support at around $5,000. However, the situation is somewhat different when median transaction values are included, mostly due to a handful of extremely large-value transactions, which push the median higher up and closer to $50 per transaction.
That would indicate that the majority of the value that is sent via the network comes from a small number of individuals with an extremely high net worth or funds.
Volumes are nowhere near traditional payment processors
$100 billion is an extremely massive number, in comparison. But even this amount is rather tiny when compared to what traditional payment networks tend to make on an annual basis. Visa, for example, reported that it transacted over $11 trillion in 2018 alone. This is nearly 4 times more than what Bitcoin managed to send in 2019.
Litecoin transactions cannot even compare with these kinds of numbers, even at its best. Of course, this also doesn’t mean that they should be compared, since LTC is, after all, a cryptocurrency. Cryptos are still considered young, they are not regulated, and they use equally as young and unregulated underlying technology.
They also lack in terms of adoption, as well as user-friendliness. Visa, on the other hand, is a service for fiat currencies that had decades to spread around the world. Fiat currencies are also fully regulated and even traditional. Another reason why the comparison between them is flawed is the fact that it doesn’t take the total value sent in USD into account, but only a certain area of the much larger market.
But, even so, there is clearly still a lot of room left for crypto markets to grow and improve, and it might take years before they become a serious competition and a real threat to the likes of Visa, and other traditional payment processors.
Do you think that Litecoin and other cryptocurrencies will ever replace Visa and others like it? Let us know in the comments below.
Image via Shutterstock The post appeared first on Bitcoinist.com.
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