Litecoin, the leader of bullish uptrends within the cryptoeconomy, was back at it on Monday with the bitcoin spinoff posting a double-digit percentage price rise for the largest rally among top coins.
Price of Litecoin
On June 10th, the price of litecoin shot up by approximately 11 percent. It reached a 24-hour high of over $128 USD, before falling to above $125. This comes just a week after LTC gained around 10%, from $109 – $120 last Friday.
This pricing is still far from LTC’s December 2017 all time high of $375. However, the latest spike in cryptocurrency’s value puts it further in green from more recent perspectives. The coin is currently up 49 percent on month, 128 percent over quarter and 14 percent on year.
Take Into Account
Monday’s performance by Litecoin put it at the top of the market’s most popular projects for the day. The bitcoin (BTC), which had dropped below $7,500 last week has gained almost four percent to $7.930. Ether (ETH), gained six percent to $244 XRP rose by around five percent to $0.396.
Litecoin is the fourth-largest digital currency in the cryptoeconomy with a market capitalization of $7.8 billion. This market cap is nearly one billion dollars more than bitcoin cash ($6.96 trillion), which is currently the fifth-placed competitor in the space.
After the litecoin’s price doubled in Q1 2019, this is a significant boost. It was the cryptocurrency’s best-performing quarter. LTC has quadrupled its value since January 1, when it was still valued at $30.
Analysts have pointed out that litecoin’s recent performance has been viewed as a bullish indicator for the wider cryptocurrency market. Analysts continue to argue that Litecoin’s “halvening” is a key reason for the buy-pressure.
Halvening in Focus
Why is Litecoin’s Halvening in Focus. The Litecoin blockchain will go through a so-called halvening in August. This will see its mining rewards drop from 25 LTC down to 12.5 LTC. Each four years, the halvening takes place. This is a remnant from the Bitcoin codebase from which Litecoin was first forked. LTC’s price soared sharply ahead of the previous halvening, which reduced rewards from 50 LTC and 25 LTC back in 2015.
What does the halvening have do with price? Simply put, scarcity or perceived scarcity is simply not available.
One of the most attractive investment features of cryptocurrencies such as bitcoin and litecoin, is that they are deflationary assets. Their issuances are subject to hard caps. There will never be more than 21,000,000 BTC created and 84,000,000 LTC mined.
In the context of halvenings bitcoin and litecoin are becoming increasingly scarce. Investors can take away that as supply decreases, demand (and prices) will rise. Some people agree with this thesis while others disagree. Regardless, many stakeholders in the cryptoeconomy will be watching Litecoin’s halvening on August 8, 2019, which will precede Bitcoin’s May 2020 issuance drawdown by several more months.
It’s a good position for Litecoin. It is regarded in recent times as a “complementary network” to Bitcoin. It is similar enough to Bitcoin but also different enough to be considered a safe testing ground for the larger, more popular blockchain.
Although Litecoin’s halvening may not be a test in itself, many will be watching it to see if it is a sign of how Bitcoin’s halvening will turn out next year. If the LTC price continues its upward trend before August, that will undoubtedly increase the perception that bitcoin will perform similarly.
Miners will be most affected by whatever happens. They will soon receive less in litecoin for all their efforts. Charlie Lee, creator of Litecoin, has said that mining will still be profitable after the halvening.
Here are some statistics about mining profitability. Miners still make money with electricity below 10C/ even after halving. Many miners are only paying 5C/, so they should continue mining LTC after halving.