– Litecoin Founder Charlie Lee wants people to stop fussing over the rally in the cryptocurrency
– Litecoin prices have risen almost 8,000 percent this year
– Lee says runaway prices are prompting people to think of cryptocurrencies such as bitcoin and litecoin as speculative assets
Litecoin Founder Charlie Lee wants people to stop fussing over the gravity-defying rally in the cryptocurrency.
“I would be happy if litecoin stays at around $300 by the end of next year,” Lee told CNBC’s Squawk Box, as the cryptocurrency
surged more than 150 percent in the past week.
Litecoin’s rallied almost 8,000 percent this year, making it the world’s fifth-largest cryptocurrency with a market capitalization of more than $15 billion, according to coinmarketcap.com.
On Friday, it traded at $261.94 on Coinbase. “It’s still very surprising how much it has grown this year,” Lee said.
“I never like to speculate on prices because I’m always wrong.
If I tell you it’s going to go up and it doesn’t, you’ll be upset,” he added.
Lee noted that the frenetic growth in cryptocurrency prices was also impeding their wider adoption as most people were using them as a speculative asset rather than using them to make real-world transactions.
“I think we’re still maybe five years away before people actually start using bitcoin and litecoin in real world use as a currency.”
As litecoin surged to new highs in early December, Lee took to Twitter to urge for calm and “rein in the excitement” over its sky high valuations.
“Bitcoin is very volatile, and litecoin is even more volatile that bitcoin,” he said. “I just want to warn people that they should invest responsibly.
Don’t spend all of your life savings to buy a cryptocurrency in case it drops 80 percent,” he added.
The growing popularity of cryptocurrencies has also attracted scrutiny from policymakers, some of whom have cast doubts over their appeal as stores of value or mediums of exchange. Others have warned investors of the risk of investing in cryptocurrencies.
Unlike other cryptocurrency purists who have expressed alarm at the prospect of government intervention, Lee welcomed recent talk of more regulation for cryptocurrencies.
“I think increased regulation will help to reduce the volatility of the coin. A lot of the recent gains have had a lot to do with countries like (South) Korea and Japan really getting into the cryptocurrency space,” Lee said.
“Ever since China banned the bitcoin exchanges, (South) Korea has really taken up the mantle. There is a lot of frenzy in (South) Korea right now and I think that’s driving up the price.”
Lee said he would not like to see South Korea banning cryptocurrencies.
However, he welcomed more regulation around Initial Coin Offerings or ICOs. An ICO is the latest way for cryptocurrency start-ups to raise money by issuing their own digital tokens in exchange for a virtual currency like ether or bitcoin.
Investors don’t get a stake in the company, but the tokens they receive can be traded or used on a service provided by the platform.
“I see those as very risky for newcomers,” he said. Asked about the introduction of bitcoin futures on the CBOE and the introduction of CME bitcoin futures shortly, Lee also said he expected to see litecoin futures on a global exchange in the future.
“I believe that as we grow, more and more people will look into litecoin and see that as a good investment asset also. I hope to see litecoin futures one day.”