Crypto hedge fund Multicoin Capital is revealing its bold take on some of the biggest cryptocurrencies on the market.
In a new interview on CNBC’s Crypto Trader, Multicoin’s managing partner Tushar Jain starts things off with a bang, calling Litecoin an overrated testnet for Bitcoin that should be worth a tenth of its current $4.8 billion market cap.
“Bitcoin has a much stronger value proposition than Litecoin, which is just a glorified testnet. Literally no one I’ve talked to can give me a reason why Litecoin needs to be worth anything.”
Jain believes shorting Litecoin while going long on Bitcoin is a strong move in a bear market, because he expects the price of LTC to drop at a much faster rate than BTC.
In addition, Jain says he’s also comfortable shorting XRP and thinks it’s likely a security. He also says he’s not a big fan of Ripple’s cross-border payment platform xRapid.
“There’s a few things that make me comfortable shorting XRP. One is that I don’t believe that the token economics are sound. Even with their xRapid product, which they like to talk up quite a lot, the velocity of the Ripple token is extremely high. So even if they were processing all of the world’s international remittances including all bank-to-bank transfers, the velocity is so high that all of the Ripple tokens in aggregate need to be worth very little in order to facilitate that…
I think there is a real chance that XRP could be declared a security by the SEC. I don’t know for sure, but based on the most recent statement where the SEC talked about Ethereum not being a security, they mostly pointed out that the Ethereum network was decentralized enough that you could no longer claim that when someone was purchasing Ethereum that they were doing so with the expectation that there was a specific group that would be working to advance the Ethereum network and increase its price.
…Ripple is solely and predominantly responsible for marketing the Ripple products that use XRP and give the XRP token any value. Without Ripple, the XRP token is worthless. Absolutely worthless. Why would you need the XRP token if this corporation – which I think is a successful well-run corporation – but if that corporation did not exist, the XRP token is worthless. If the Ethereum Foundation disappears tomorrow, Ethereum still has value.”