- Litecoin is seeing highs it isn’t skilled since its founder Charlie Lee cashed out in 2017.
- Lee mentioned folks nonetheless do not perceive his motivation, which was specializing in elevated adoption versus the value of LTC.
- He outlined plans for Litecoin’s new privateness improve, and his views on crypto regulation—which he believes is inevitable.
When (LTC) broke via the $200 barrier final weekend, for the primary time since March 2018, it sparked jubilation amongst LTC holders—as you would possibly anticipate. However one man, who bought all his Litecoin in December 2017, was simply as overjoyed.
For 3 lengthy years, Charlie Lee, Litecoin’s 34-year-old founder, has confronted vocal criticism from some within the cryptocurrency’s neighborhood for cashing out close to the height. It has been a daily background noise in his life, as LTC (alongside different cryptocurrencies) endured a prolonged crypto winter.
Now that the world’s eighth-biggest cryptocurrency is lastly reliving its former glories (although it has but to surpass its all-time excessive of round $360), Decrypt sat down with Lee to speak concerning the undertaking’s upcoming privacy upgrade; his shopping for and promoting methods, and Litecoin’s prospects within the coming months.
Barks from the bridge
Lee is without doubt one of the most well-known figures within the cryptocurrency business. Seated towards a dramatic background, he seemed to be on the bridge of Darth Vader’s ship from Star Wars. Solely his Labradoodle’s occasional barks belied the truth that he was really talking with Decrypt on a Zoom name from his house in San Francisco.
He comes throughout as pleasant however critical; an keen however affected person trainer—practiced in explaining Litecoin’s advantages, together with its zero downtime and safety features, and excited concerning the upcoming MimbleWimble Extension Blocks (MWEB) improve, which is able to give the cryptocurrency privateness benefits.
Lee was born within the Ivory Coast and educated within the States from the age of 13. He’s an MIT graduate, in addition to a veteran of Google and crypto change .
Do you know?
Lee is an enthusiastic hockey participant and has performed in a Bay-Space league for twenty years.
He thought up Litecoin in 2011—forking the blockchain to create the “Lite model of Bitcoin,” a cryptocurrency that adopts a lot of its dad or mum’s key options, however seeks to enhance on it with a bigger provide, quicker transaction occasions, and decrease charges.
“I did not actually anticipate something of it,” he recalled. However, as Litecoin approaches its tenth anniversary in October, its market cap is now virtually $15 billion—and loads of folks imagine its excessive liquidity, availability on exchanges, and longevity invite comparisons with solely Bitcoin itself.
“It’s stood the check of time,” mentioned Lee. Among the many challenges it is confronted over time, one, specifically, stands out: its founder cashing out in December 2017.
Lee’s major cause for promoting virtually all his LTC in December 2017 was battle of curiosity. Specializing in adoption and success, not worth, is what pursuits him, he mentioned.
“Elon Musk is paid to extend the share worth of Tesla, whereas my objective is to extend adoption and make Litecoin profitable—which is aligned with the value nevertheless it’s not precisely the identical,” he defined.
“Elon Musk is paid to extend the share worth of Tesla, whereas my objective is to extend [Litecoin] adoption.”
However his motivations had been misunderstood, and he is fought comparisons with a CEO like Musk, who’s paid in shares.
“I purchased my very own shares,” he mentioned and added that the quantity of LTC was, in any case, nowhere close to what somebody like Musk holds in Tesla. So claims that his cashing out might affect the ; that he had insider data, and even that he crashed your entire crypto market, had been “ridiculous,” he mentioned.
“Folks at all times say I bought on the all-time excessive, however that is removed from the reality. I bought on the best way up. My common worth was $200,” he mentioned.
He added that he’d made a public announcement, which gave folks the chance to promote in the event that they had been sad, and that regardless of that, the value of Litecoin remained excessive for every week.
However lots of people thought he will need to have give up, with no incentive to work on Litecoin anymore. The truth is, it’s simply the alternative: “The success of Litecoin incentivizes me greater than something,” he insisted.
Litecoin and Mimblewimble
Proper now, Lee is most excited by the prospect of privateness options coming to Litecoin.
The undertaking’s imminent MWEB improve will give it so-called “fungibility,” the place one coin is indistinguishable from one other.
“That is what makes cash highly effective as a result of each coin or any invoice is similar—it is fungible. Presently, that is not the case with Litecoin and Bitcoin,” mentioned Lee.
Using more and more subtle analytics (and the truth that transactions are recorded on a public blockchain) signifies that these cryptocurrencies, and most others, will be tracked. Not solely can they be linked to darkish markets—which dangers the account proprietor being banned—however the lack of privateness makes for dangerous monetary etiquette:
“Should you purchase 10 Bitcoin from an change after which give a small quantity—like $10—to your pal, [then] your pal can see that you’ve got $300,000 in your checking account.” (When our interview came about, in January, BTC was at $30,000).
To treatment this type of scenario, the undertaking is introducing experimental new privateness options, based mostly on privateness know-how MimbleWimble (which takes its uncommon identify from Harry Potter).
To introduce the brand new code, the blockchain will want a smooth fork—and how briskly that occurs is dependent upon how briskly the miners are prepared for it, mentioned Lee. “It may very well be a month. It might take as much as a 12 months.”.
A testnet was launched last September, and the preliminary code for integration with the mainchain might be full and prepared for overview on March 15.
“It is type of like a aspect chain—one thing that is connected to the principle chain,” mentioned Lee. “You possibly can transfer cash from the Litecoin mainchain, which continues to be the clear blockchain, to the M-Chain.” Quantities are hidden, and transactions on the chain are extra non-public, he defined.
A conservative strategy
In current months, privateness cash and identity-obscuring instruments have appeared on the regulators’ radar. A report revealed in October final 12 months by the US Lawyer Common’s Cyber Digital Process Power outlined a new regulatory framework, and labeled nameless transactions “high-risk exercise indicative of potential legal conduct.”
Subsequently, lawyers have warned that new restrictions would put stress on exchanges that provide privateness cash—corresponding to Monero and Grin—to think about whether or not it’s nonetheless potential to adjust to anti-money-laundering obligations. And a few Litecoin investors have balked on the threat of LTC being delisted on account of harsher laws.
Lee is unperturbed. The improve won’t make Litecoin a privateness coin; MWEB is an non-compulsory function, it’s totally reversible, and exchanges do not see any concern with compliance or falling afoul of laws with this improve, he mentioned.
“We’re taking this very conservatively,” he emphasised. “We do not need this to harm; we need to nonetheless be on all of the exchanges to have excessive liquidity.”
“Bitcoin and Litecoin, in my view, can work with regulation.”
However, like many, he thinks regulation is inevitable and vital for cryptocurrencies to succeed. “Bitcoin and Litecoin, in my view, can work with regulation,” he mentioned. “There is likely to be extra crackdowns, and regulation is likely to be more durable on crypto-fiat on-ramps and off-ramps, however I do not assume you may ever get to a degree like banning cryptocurrency. I believe we’re previous that time now.”
Ought to extra stringent laws on privateness be launched, Lee mentioned he would first flip to the neighborhood earlier than taking any motion. He conceded that it is likely to be controversial, with some members of the neighborhood dedicated to pushing for privateness even when it drives LTC onto illicit exchanges, some arguing that Litecoin should not care what the regulators assume and others eager to play it protected.
Some would argue that the latter consists of Lee himself, regardless of his enthusiasm for MWEB. “The most effective options of Litecoin is liquidity,” he mentioned. “We should not damage that it doesn’t matter what.”