Why Litecoin bulls are failing to bank on halving hype
- Litecoin hits new transaction milestone despite slowdown in network demand.
- LTC’s price action targets $80 as bears wipe out some of its recent gains.
Earlier this month, the Litecoin [LTC] network experienced a surge in activity. In addition, there was growing hype regarding the upcoming halving and this triggered a resurgence of bullish demand for LTC in the second week of May.
Read Litecoin (LTC) price prediction for 2023/2024
Fast forward to the present and LTC has delivered a bearish performance so far this week.
Its current trajectory looks to be headed for a retest of its ascending support which will likely happen near the $80 price level. LTC exchanged hands at $84.41 at press time after falling from a $94 weekly high.
LTC’s weak price action this week reflects the slowdown seen in the overall crypto market in the last 2 weeks.
One of the potential reasons it failed to sustain the hype observed earlier this month could be the fact that the halving is still more than 2 months away. Bullish momentum is likely to be stronger four to two weeks ahead of the actual event.
Litecoin demand slows down
The lower demand is a reflection of the drop in demand for the Litecoin network.
The number of active users dropped from a monthly high north of 830,000 on 10 May and has since dropped to lower than 500,000 active users.
Litecoin’s total value locked in DeFi platforms also slid by a significant margin from its highest level in May.
The lower demand is particularly evident in the weighted sentiment metric which has been on an overall downward trajectory since peaking on 17 May.
This outcome was accompanied by a noteworthy drop in volume. There was a slight volume uptick in the last 2 days but this is largely associated with the surge in sell pressure.
Litecoin’s overall performance reflected a slowdown in network activity and demand for the LTC cryptourrency. Nevertheless, the network has maintained healthy growth during the last few weeks and is still achieving healthy milestones.
The network just revealed that it added at least 10 million transactions in the last 6 weeks, confirming that there has been decent utility despite the slowdown. In addition, it recently hit a new transaction milestone.
The Litecoin network just processed its 160 millionth transaction!
That's over 10 million transactions in the last six weeks!!
⚡ $LTC ⚡ pic.twitter.com/OqGWoEczLm
— Litecoin (@litecoin) May 24, 2023
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What should Litecoin traders expect moving forward?
Litecoin is still one of the most popular networks and it has been growing at a healthy pace. The same applies to LTC adoption as one of the few PoW cryptocurrencies remaining.
A tried and tested network adds to the list of pros that boost its long-term prospects.