Fair value of major altcoins?

[Hell-raiser]

I mostly refer to Litecoin here when I speak about major altcoins. Litecoin is interesting because it is essentially a juiced version of Bitcoin. It has faster confirmation times, lower transaction costs, and LN has been activated in it since April, 2017, even though this feature is not very actively used (read it is pretty useless for the time being).

So how low may Litecoin's price fall? Actually, it is a tricky question if we assume that Litecoin has significant use beyond sheer speculation, which doesn't look like a baseless assumption. In effect, it means that there is a limit below which the price of Litecoin simply can't go (long term, at least) because its real utility will inevitably kick in and support the price (think oil here). Speaking more generally, if any coin has some application in real life, the lower limit of its price would be determined by that application (so-called "fair value"). Also, it is no secret that Bitcoin's price is the primary driver behind altcoins price dynamic. And it looks like these two things can't live quite well together (when Bitcoin goes down the hill), therefore there should necessarily be a balance of sorts at which these forces cancel out each other.

So is it possible to determine that fair value somehow (as seems to be the case with real goods)?

[Red-Apple]

being an exact copy of another coin doesn't make a coin interesting and LTC is an exact copy of bitcoin with little redundant changes.

with that said LTC is not useless. it actually is one of those rare cases that is accepted as a real currency in the real world and you can't find that easily these days among altcoins but it is too little and on a small scale.

as for its price, it is again one of those rare coins that usually follows bitcoin while others go down. so we have to wait for bitcoin price to rise and litecoin price to follow it or we need some sort of LTC pump which i don't see any reason for. i can't say if it is a fair value or not though because as i said above it is a copy coin.

[CryptoGamblingSites]

Getting into bitcoin or altcoins with your only goal being to make money will hopefully fail for everyone who only has that goal.

If you want to support a project and technology like bitcoin or litecoin, that will probably pay some dividends years from now. If your only goal is to make money, go play in the shitcoins and hope like all the rest that will go broke.

With Bitcoin "down" like this and every altcoin getting squeezed....expect a very rough year in altcoins and ICO's while everyone stores value in bitcoin.

[Hell-raiser]

being an exact copy of another coin doesn't make a coin interesting and LTC is an exact copy of bitcoin with little redundant changes.

with that said LTC is not useless. it actually is one of those rare cases that is accepted as a real currency in the real world and you can't find that easily these days among altcoins but it is too little and on a small scale.

That's why I said Litecoin is interesting as an object for analysis as it seems to be used in the real world despite being a Bitcoin copycat. And I'm not saying that Litecoin itself is useless, by being useless I referred to LN obviously. Apart from that, I can't quite agree with your opinion about these "little redundant changes". On the contrary, there are two major factors that make a coin useful as a real currency and it is exactly them (those little "enhancements"), i.e. faster confirmation times and lower transaction costs.

as for its price, it is again one of those rare coins that usually follows bitcoin while others go down. so we have to wait for bitcoin price to rise and litecoin price to follow it or we need some sort of LTC pump which i don't see any reason for. i can't say if it is a fair value or not though because as i said above it is a copy coin.

And that's the whole point. If Bitcoin goes down, Litecoin goes down too, even with some acceleration applied. But as it seems to be actually used in the real world for various purposes, it can't follow Bitcoin forever on its way down. There must be a point on the price scale where this connection should be severed.

[beleyeleazar]

I mostly refer to Litecoin here when I speak about major altcoins. Litecoin is interesting because it is essentially a juiced version of Bitcoin. It has faster confirmation times, lower transaction costs, and LN has been activated in it since April, 2017, even though it is not used (read it is useless).

So how low may Litecoin's price fall? Actually, it is a tricky question if we assume that Litecoin has significant use beyond sheer speculation, which doesn't look like a baseless assumption. In effect, it means that there is a limit below which the price of Litecoin simply can't go (long term, at least) because its real utility will inevitably kick in and support the price (think oil here). Speaking more generally, if any coin has some application in real life, the lower limit of its price would be determined by that application (so-called "fair value"). Also, it is no secret that Bitcoin's price is the primary driver behind altcoins price dynamic. And it looks like these two things can't live quite well together (when Bitcoin goes down the hill), therefore there should necessarily be a balance of sorts at which these forces cancel out each other.

So is it possible to determine that fair value somehow (as seems to be the case with real goods)?

Well there is no "fair value" of a specific coin because it really various per project and of course per tokens that is being released in the market, the reputation of the coin, the value of the project. Besides, there is no single point of comparison for all projects except that they're all altcoins. So there's no standard really.

[andthereyou]

It's really hard to determine the fair value of litecoin. Maybe we can do an estimate calculation using some empirical formulas we can come up but the problem is who will believe us and accept the calculated fair value. Unlike tether though it's controvertial, however people still use and accept its fair value.

[Hell-raiser]

Well there is no "fair value" of a specific coin because it really various per project and of course per tokens that is being released in the market, the reputation of the coin, the value of the project. Besides, there is no single point of comparison for all projects except that they're all altcoins. So there's no standard really.

I tend to disagree. Fair value (as I understand it) is determined by real use of a coin. By real use or application I understand any use which is not speculation, with the latter being epitomized by the "buy low sell high" logic, either outright or indirect. That could be payment for services like signature campaigns, buying stuff directly with the coin, for example, groceries, that is whatever actually contributes to the currency aspect of this coin.

So it looks like Litecoin has such use just like any other good out there, though it may be small. This use gives it value which should remain there (more or less) irrespective of the market price of the coin, which is made up mostly of speculative value (aka speculative utility). Indeed, shitcoins don't have this use value, and the concept of fair value is not applicable to them as their value is all fake and hype. But Bitcoin as well major altcoins (and maybe some tokens) is different in this regard, and it is possible, at least theoretically, to calculate or derive the monetary appraisal of it.

[vladuch1]

being an exact copy of another coin doesn't make a coin interesting and LTC is an exact copy of bitcoin with little redundant changes.

with that said LTC is not useless. it actually is one of those rare cases that is accepted as a real currency in the real world and you can't find that easily these days among altcoins but it is too little and on a small scale.

as for its price, it is again one of those rare coins that usually follows bitcoin while others go down. so we have to wait for bitcoin price to rise and litecoin price to follow it or we need some sort of LTC pump which i don't see any reason for. i can't say if it is a fair value or not though because as i said above it is a copy coin.

I agree with you. Litecoin really has some changes, but this coin has not become better and more interesting to me. The LTC price is almost entirely up to the bitcoin price and it's for sure!

[Red-Apple]

There must be a point on the price scale where this connection should be severed.

it is easier said than done.
the connection doesn't just involve the price or similarity, LTC is connected to bitcoin on many different levels. it starts with having the same source code for the most part and it continues with LTC developers copying every code from bitcoin source code and porting it in LTC source code. and also it does everything else that bitcoin does, for example bitcoin wanted SegWit they added SegWit, bitcoin wanted LN, they added LN.

[Hell-raiser]

There must be a point on the price scale where this connection should be severed.

it is easier said than done.
the connection doesn't just involve the price or similarity, LTC is connected to bitcoin on many different levels. it starts with having the same source code for the most part and it continues with LTC developers copying every code from bitcoin source code and porting it in LTC source code. and also it does everything else that bitcoin does, for example bitcoin wanted SegWit they added SegWit, bitcoin wanted LN, they added LN.

I see your point and don't particularly disagree with it. Litecoin, all in all, is still mostly a Bitcoin copycat, whether anyone likes it or not. But this is irrelevant to the question I raise in this topic. Being technically a copycat ("having the same source code", etc) doesn't really mean that it can't be used more widely or in different areas for different purposes than its progenitor. And in this respect, it is its use that actually matters, not the fact that Litecoin originates from Bitcoin. A human child originates from his parents, so he is also a sort of copycat of their genetic codebases combined, but does it mean that his life will be an amalgam of theirs?

[Hell-raiser]

It would be unwise to call Litcoin useless. This coin is in a bad state at the moment but when the market improves, it will recover from it too. This actually follows the trend of BTC which is rare to see in other coins.

For the record, I'm not calling Litecoin useless. I refer only to Lightning Network in it which is useless since no one is using it as of yet. You see, Litecoin network has enough processing capacity (just like Bitcoin's presently, for that matter), and its use makes no sense when you can send coins directly without any issues and pains with employing second-layer possibilities, that is, with setting up payment channels. With respect to Litecoin itself, on the contrary, I'm inclined to think that it is one of the rare coins which has actual use in real life beyond financial markets.

Well, I should probably make it more clear in the OP.

[Hell-raiser]

Getting into bitcoin or altcoins with your only goal being to make money will hopefully fail for everyone who only has that goal.

I understand (kind of) what makes you think so. Let's just say that you don't like hardcore speculators (profiteers) and want them all to die a painful death. Well, maybe not to die but definitely lose all their money. Is that your mode of thinking? But the sad truth is that we can't punish only the wicked and reward just the righteous as the only way to bestow justice is via prices, and that can and will hurt the innocent. So your wish is unlikely to come true, no matter what.

If you want to support a project and technology like bitcoin or litecoin, that will probably pay some dividends years from now. If your only goal is to make money, go play in the shitcoins and hope like all the rest that will go broke.

This is where I seriously disagree with you, and I hope that I won't be alone in my disagreement. If not for all these guys who should fail miserably according to you, Bitcoin would still be largely unknown to a wider public, and no big projects would have ever been started. Consequently, all these people volens-nolens contributed greatly to Bitcoin popularity and through this to its wider adoption even despite their entirely selfish, purely pecuniary interests. To sum it up, you should look a little further and deeper than what's right on the surface. You should also make allowance for some indirect and delayed effects, not just immediate consequences.