Connect with us

Altcoins

Litecoin [LTC] community looks forward to surge in prices after implementation of Halving in 186 days

Jibin M George

Published

on

Litecoin [LTC] community looks forward to Halving 186 days away; Expects a surge in prices eventually
Source: Pixabay

At the time of writing, Litecoin [LTC] is still over 186 days away from its block rewards being halved again, a ‘halvening’ as many in the cryptocurrency community call the process. However, with LTC prices still recovering from the huge fall in prices it has suffered over the past year, there are some in the LTC community who are looking forward to it, hoping for a sharp surge in prices following it.

Halving, or ‘halvening’ is the process by which miners have their block rewards (Usually, a set lot of coins) for mining split in half after a target number of cryptocurrencies, whether it is Bitcoin or Litecoin, have been mined. The system of halving, as initially proposed by Nakamoto in his White Paper, not only ensures that the cryptocurrency in question doesn’t run out of its limited supply of coin, but also makes sure that the prices rise steadily over time owing to the limited supply of coins available.

Since the first cryptocurrency, Bitcoin, now also the world’s largest cryptocurrency, was mined, there has been a lingering perception among many that halving is a catalyst for a surge in cryptocurrency prices. Part of this perception has risen from the history of Bitcoin and Litecoin. Post each of their halvings, both coins had witnessed stable growth before surging to all-time high prices within 24 months. There are thus many who expect to cash in on their gains after Litecoin surges post the halving expected in six months.

Source: Twitter

However, this may be a mistaken perception. Although cryptocurrencies such as Litecoin and Bitcoin have seen a history of surging prices within two years of each halving, some say that halving itself hasn’t had a significant impact on the prices.

Glenn Goodman, for instance, a Bitcoin analyst and author has suggested that halving has a negligible impact on price as the anticipation for a halvening, much like an expected interest cut, makes token holders and the market be prepared for it, by extension guarding it against any sudden price movement. His opinions are backed by Litecoin’s Charlie Lee himself, who has previously said that halving and prices have no correlation whatsoever.

Some have in fact suggested that there were other factors to account for too. For instance, an increase in the number of people using the Litecoin network will directly push the price of the coin upwards, with or without the halvening.

Then there is also the question of miners. With the block reward being halved, there may be miners who may move to mining some other coin that offers a higher block reward and is thus, more profitable. This loss of hash and processing power would, in fact, push the price of any cryptocurrency, says Litecoin down.

Although this will be corrected by the difficulty associated with the mining process being reduced over time, the immediate future of a coin after the halving event seems to be in the red.

Finally, a coin such as Litecoin doesn’t exist in a vacuum. Like other coins, it is also affected by developments in the cryptocurrency and financial markets. This means that halving or not, events outside the control of Litecoin may also have an effect on the coin, an effect that may push its prices upwards or down.

Halving, or ‘halvening’ is thus a more complicated process that some may believe and the perception that it guarantees a surge in value eventually is mistaken as it doesn’t account for other factors at hand.



Follow us on Telegram | Twitter | Facebook



Jibin M George is a graduate in International Relations and Law with a growing interest in the world of cryptocurrency and blockchain technology

Trending