On Nov. 9, the Litecoin (LTC) news site litecoin.com reported one of the highest transactions to date on the LTC network, valued at 1,159,005.90779568LTC, or roughly $62M USD. Aside from the sheer amount of money moved, the transaction gained attention because it was settled for a mere fifty cents.
— Litecoin.com (@LitecoinDotCom) November 9, 2018
In the world of conventional currency, bank fees can run $45 or higher per transaction and can be held up while waiting on confirmation from intermediaries. Other crypto assets like Ripple’s XRP are trying to build a brand based on circumventing the present infrastructure for cross-border payments, which can be the most expensive of all.
The LTC funds were made in a series of transfers which appear to have consolidated the crypto under a single multi-signature address. That address is now reportedly one of the richest LTC addresses on the network. The theory put forward by Litecoin.com is that a large entity, possibly an exchange, owns it, and transferred the funds there as part of its cold-wallet holdings:
“…it is most likely an exchange cold wallet which is used to securely store funds that are held on an exchange offline away from potential attackers. The move into a multi-signature address would provide the owner(s) better security as any transactions would need to be signed off by multiple parties as unlike with Legacy addresses there are multiple private keys to the address.”
Transaction fees for crypto are going down across the board, with other massive transfers of cryptos like Bitcoin being conducted for the equivalent of $0.10 at the time of this writing. The average transaction fee for BTC is still somewhere around $0.36, according to Live Bitcoin news, but that’s still far better than last year’s $25-$55.
Trying to Leverage the Potential of Decentralization
Aside from security concerns, transaction fees and the amount of time it takes to transact in crypto are two of the biggest roadblocks to mainstream acceptance of cryptocurrencies.
If fees continue to drop and transactions become more efficient, crypto could become a viable option for the transfer of even very large sums of money. Developments like the Lightning Network are bringing this closer to reality, even for notoriously clunky BTC, and products like Xcurrent and Xrapid are trying to get big banks on the crypto train.
The ease with which crypto can be transferred has also led to charitable organizations branching out into countries like Africa, where they are trying to put currency in the hands of people without financial infrastructure. Crypto’s decentralized nature makes this easy but also makes security an issue, as less oversight means more opportunities for fraud.
Cover Photo by Daniel Olah on Unsplash