The crypto space has been embracing new enthusiasts, especially since the bulls returned in the market back in April. Before investing, it’s essential to know a thing or two about the market, but the most important thing is to be prepared to risk.
Prepare yourself for high risks
Litecoin’s creator, Charlie Lee believes that novice crypto investors should prepare themselves for risks.
During an interview on Crypto Love, Lee brought up the warnings that he gave to investors back in 2017 when LTC’s value was boosted to the moon.
“Crypto’s really risky. I’ve seen many bear markets or crashes that are 90% down. So, at that time when it was $200, I said it can drop to $20 and don’t be surprised if it does, and what happens is when the price does crash, it shakes off all the weak hands,” he said.
He continued and said that “Everyone who bought in at $200 or higher will sell at $20, and they’re losing 90% of their portfolio. So, my point was that if you can’t withstand a 90% drop, then don’t buy in, because it’s too risky for you.”
You may recall that Litecoin dropped to $20 by December 2018, and now it’s trading around $118.
Lee says he thinks Litecoin hopefully “bottomed out” already.
Upcoming LTC event
Lee also addressed the upcoming halving event which is set to take place less than a month from now.
He said that this event is somehow a shock to the system and when the mining rewards get cut in half, it’s obvious than some miners will not be profitable and they will be shutting down.
If a big percentage does this, the blocks will slow down for a while. He assumes that there will be about seven days of slower blocks, but then everything will be fine.
He explained that “In terms of the price, the halvening should be priced in because everyone knows about it since the beginning. But the thing is people kind of expect the price to go up.”