Litecoin’s founder says that it does not make sense to compare the inflated market capital of Stellar with Litecoin (LTC).
Stellar Outperforms Litecoin?
Bitcoin (BTC) has gained ground to over $7,000 this week. And with the BTC there are also others cryptocurrencies that have seen their prices rise.
Stellar (XLM) is one of those that has seen strong growth of around 30% in the week. This has allowed Ripple’s younger sister to outperform LTC by market capitalization. XLM is currently number six at about $5.3 billion compared to LTC’s $4.8 billion.
LTC founder, Charlie Lee, congratulated XLM on beating their project from their Twitter account:
Congrats to Stellar on passing Litecoin's marketcap. That said, it really doesn't make sense to compare marketcaps of coins that are "printed", b/c they have an inflated marketcap. Maybe I'm old school, but I only care about decentralized mineable coins.https://t.co/n6va1YWoiD pic.twitter.com/4IMJ7iqg3H
— Charlie Lee [LTC⚡] (@SatoshiLite) July 20, 2018
Why are ‘Mined Coins’ so Important?
Lee believes that the market capitalization index is not the most accurate metric for comparing cryptocurrencies. Largely because it does not reflect decentralization or how they were created. Since, digital tokens like XRP and XLM should not be in the same category as mineable cryptocurrencies. That is, those using a Proof-of-Work (PoW) consensus algorithm, as is the case with LTC and BTC.
Lee took advantage of his tweet to give the list he considers correct, showing only coins that can be mined. When applying this filter we see how Stellar, EOS, Cardano or IOTA are out of the top ten.
The metrics of market capitalization have historically been very volatile. By default, CoinMarketCap positions any digital currency by comparing its capitalization. Therefore it does not reflect how decentralized a currency is.
Stellar, A Different Philosophy
Although the SEC has said that decentralized cryptocurrencies are not securities, it remains to be seen what will happen with others digital tokens, especially XRP and XLM. These are projects with different philosophies.
Stellar been making some big moves lately. This week it received certification for both its platform and its Lumen token. The certification was made by Shariyah Review Bureau, an Arab firm based in Bahrain.
In June, Stellar signed a $500 million agreement at XLM to buy a financial startup of blockchain. While your currency is one of five considered by Coinbase to be listed in the future.