On-chain data shows Litecoin is healthy, potential for LTC/BTC rebound 🚨 This article is 5 years old...
On-chain data shows Litecoin is healthy, potential for LTC/BTC rebound
3 min read
Updated: Nov. 7, 2019 at 2:32 am UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
On-chain data around Litecoin is showing several healthy indicators, including an increase in the number of large transactions on the network. Apart from that, Litecoin’s volatility and price correlation to Bitcoin have dropped, indicating that there’s potential for a major LTC/BTC rebound.
Deep dive into Litecoin network data
The world’s fifth-largest cryptocurrency by market cap, Litecoin, has spent the better part of the year struggling against Bitcoin. After dropping to a yearly low of $65 at the beginning of September from a peak of $98 at the beginning of August, the coin has only now started showing signs of recovery.
Nonetheless, reports of mining unprofitability and a decreasing hashrate, stemming from the halving, seem to have raised doubts about the network, even though fundamentally Litecoin remains secure, according to answers in an interview with founder Charlie Lee.
However, a deep dive into Litecoin showed that the lack of confidence was largely unfounded. Instead, network data shows Litecoin is both healthy and growing. Data service Into The Block showed that the concentration of large holders on the network was going up, as was the number of large transactions.
Moreover, the coin’s price hasn’t dropped significantly after the Aug. 5 halving, but its correlation to Bitcoin, one of its main bullish indicators, did.
More large transactions and more whales
In the past 24-hours, the Litecoin network has seen the number of large transactions on its network go up. Into The Block defines a large transaction as greater than $100,000, and the data revealed that there is an increasing number of people moving large amounts of money on the Litecoin network.
Another major bullish sign is the number of people who have made money on Litecoin. For any balance of tokens, Into The Block finds the average price at which the tokens were purchased and compares it to its current price. If average costs were less than the token’s current price, the address would be “in the money,” up by a meaningful margin.
The graph shows that 1.09 million, or a third of all Litecoin addresses, were in the money.
Litecoin’s correlation to Bitcoin, which is seen as one of the network’s main bullish indicators, has also been steadily declining. The coin reached its 30-day high Bitcoin correlation on Sep. 4, just before the halving, at 0.93. However, the correlation factor has been dropping ever since and has gotten as low as 0.42 at press time.
In the past month, there has also been an increase in the number of large Litecoin holders. Into the Block found a 1.68 percent increase in the number of addresses that have been holding LTC for at least a year.
This, followed by a 0.72 percent increase in the volume of assets held in addresses holding Litecoin for a year or more (HODLRs), demonstrates that most whales have retained their LTC holding even after a tough year.
Overall, it seems the skepticism from the cryptocurrency’s decreasing hash rate and lackluster price performance is unwarranted. Fundamentally, Litecoin continues to show strong growth.
Litecoin Market Data
At the time of press 2:32 am UTC on Nov. 7, 2019, Litecoin is ranked #5 by market cap and the price is down 0.4% over the past 24 hours. Litecoin has a market capitalization of $4.36 billion with a 24-hour trading volume of $2.37 billion. Learn more about Litecoin ›
Crypto Market Summary
At the time of press 2:32 am UTC on Nov. 7, 2019, the total crypto market is valued at at $264.42 billion with a 24-hour volume of $47.3 billion. Bitcoin dominance is currently at 70.21%. Learn more about the crypto market ›
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Litecoin
$90.6097
Litecoin is a peer-to-peer Internet currency that enables instant, near-zero cost payments to anyone in the world.
Bitcoin
$99,046.45
Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
IntoTheBlock
IntoTheBlock is a data science company applying cutting-edge research in AI to deliver actionable intelligence for the crypto market.
Charlie Lee stands prominently in the cryptocurrency community as the founder of Litecoin and currently holds the position of Managing Director at the Litecoin Foundation.