The recent improvement in the overall crypto market sentiment has rubbed off on Litecoin as the coin witnessed accelerating adoptions in the past few days. Also, the Total Litecoin Addresses have surpassed Ethereum’s, showing that more people are starting to transact with the coin.
The director of the Litecoin Foundation could not wait to show off this impressive performance as he shared his excitement with the community on Twitter. The director's tweet revealed that LTC recorded increased growth, surpassing Ethereum in Total Addresses.
He shared a shot from Glassnode’s analytics charts indicating total Litcoin recently outnumbered Ethereum—which previously had a higher number—in addresses. The term "total addresses" is a metric that measures the number of unique addresses of a cryptocurrency that have carried out at least one transaction on the chain during the network's lifetime.
The above chart shows the trend change comparison between the Total Addresses for Ethereum and Litecoin over the past few months. It indicates that Ethereum’s Total Addresses were higher than Litecoin’s until very recently. However, Litecoin saw a sharp increase in new addresses over the past few months.
Ethereum also observed some remarkable increases. But Litcoin pushed higher, overtaking ETH and not showing any sign of depreciation. This increase in total addresses means that users (old or new) are creating new ones on the blockchain. The fact that Litecoin’s addresses have increased indicates that more investors are coming into the network.
Data from the world’s largest crypto payment platform, BitPay, confirms this assumption. BitPay shared a status on Twitter, saying that Bitcoin isn’t the only cryptocurrency people are spending. The crypto payment firm confirmed that Litecoin payments are on the rise, with a pie chart showing 27.64% in Litecoin payments against Bitcoin’s 41.62%. With that number, Litecoin ranked second most spent crypto on BitPay’s platform.
The pie chart above shows that Litcoin contributes 27.64% of the transactions on BitPay, while Ethereum is 11.66% and Dogecoin 9.23%. Bitcoin has the highest number of transactions, with Litecoin tailing closely behind it before Ethereum.
Possible Reasons Behind Litecoin’s Growing Adoption
The fact that Litecoin offers faster transactions with a low fee as a mode of payment could be the reason for its increasing adoption over other cryptocurrencies. Aside from the increase in total addresses, Litecoin's price has also increased over the past few months. It could also be an explanation for its growing adoption rate.
Higher coin prices mean investors can make more gains in transactions, hence a point of attraction for more. In addition, more adoption could be good for the coin’s price in the long term since an increased user base can avail a reason for future price rallies.
Moreover, Litecoin halving event will take place in 2023. The halving event would see the coin's production rate slashed by half. Historically, halvings are known for their bullish effect on cryptocurrencies as they make the asset scarce. It cuts the coin's total circulation by half.
Since its launch, Litecoin has undergone two halving events, the first in August 2015 and the second in August 2019. After the halvings, Litcoin corrected to a bottom price, followed by a massive rally that saw it to a new all-time high. Therefore, the hype around the anticipated halving could be among the factors pushing Litecoin’s price and adoption higher.
Also, Litecoin’s increasing adoption ahead of the halving event is a bullish indicator for investors.
Litecoin Price Outlook In the last Month
According to Statista, Litecoin's price peaked between late 2017 and 2020, reaching all-new highs of around $250 in April 2021. However, the coin experienced corrections in 2022.
Litecoin has seen a significant rally since January, with a 30-day price gain of 26.7%. The coin has also observed a 14-day rally of 8.5% and a 7-day price gain of 0.6%. However, its price has declined by 3.11% in the past 24 hours and a 1-hour decline of 0.2% at press time.
Previously the coin formed a golden cross on the chart, and the price increased. A golden cross appears when the 50-day Simple Moving Average (SMA) crosses the 200-day SMA.
But Litecoin has dropped slightly from its recent rally, trading in a sideways trend. LTC is currently trading at $87.56, a 3.11% price loss. Its support levels are $81.06, $83.89, and $85.52, while its resistance levels are $89.98, $92.80, and $94.44. It is trading above its 50 and 200-day SMA, meaning the price sentiment is bullish for the coming weeks.
The Relative Strength Index (RSI) is at 60.40, showing that LTC is slightly in the buy zone today. However, the asset can reverse to neutrality if the bears drive down the price. The Moving Average Convergence/Divergence (MACD) shows a convergence and is currently bearish. Expect Litecoin’s price to dip further before correcting to surpass the first resistance level of $87.56.
The following price predictions are only the author's opinion, not Margex's view or trading advice. Note that crypto assets are highly volatile, so it is crucial to do your research. If in doubt, seek help from a financial advisor.