Litecoin experienced an uptick in prices following a GlobeNewswire false announcement implying that Walmart Inc. is planning to allow shoppers to pay using cryptocurrency.
The now-deleted press release indicated that — beginning October 1st — Walmart Inc. e-commerce stores will start to accept Litecoin as a mode of payment.
Shortly after, Litecoin, which is an alternative cryptocurrency based on the model of Bitcoin, soared to as much as $236.26 — a 26% price increase in less than an hour.
Before the sham statement, Litecoin was steadily trading at $173.40.
Prices Came Tumbling Down
The giant retailer, through spokesman Randy Hargrove, officially confirmed that the press release was a fake news item. And that Walmart is not in partnership with Litecoin.
Walmart is following up with GlobeNewswire to find the genesis of the press release.
Twitter users and the media immediately jumped on the matter. And started questioning the validity of the press release. That was the proverbial final straw as Litecoin prices came tumbling back to earth — drastically falling to about $175.50.
Welcome to the highly speculative crypto markets, where prices shift in a snap. Anyone considering investing in cryptocurrency should be prepared to heavily lose (or gain).
As we speak, Litecoin has over $12 billion worth of crypto coins in the market. And ranks 15th in the cryptocurrency food chain.
Key Lessons to Learn From the Artificial Price Surge
First, never trade cryptocurrencies based on the latest news. It’s not one of the greatest ideas. News updates can directly impact the crypto markets, triggering a price shift.
According to LQwD Fintech Corp CEO, Shone Anstey, be skeptical before trading in cryptocurrency. And always question the latest news updates.
“Isn’t it a little odd for Walmart to embrace Litecoin [not even Bitcoin] as a start to accepting cryptocurrency?” He asked.
Next, build a clear trading strategy. Then follow it. People who bought Litecoin based on the news update need to master the rules for trading cryptocurrency assets, which are often repeatable and quantifiable.
In other words, do some due diligence. Look at the important fundamentals — such as actual usage and adoption — and statistical models of the crypto before trading.
Lastly, take a long-term view of the volatile crypto markets. The fake announcement was a wicked tactic to manipulate the digital currency markets. Incidentally, this might happen again, and so many investors will fall prey … yet again.
The latest Litecoin price dip is a reminder of the perils of making short-term crypto decisions. So, be cautious the next time you want to trade in cryptocurrencies.