Litecoin (LTC) miner reserves have fallen to a multi-year low, reaching 1.61 million LTC ($120 million), representing a 29% decline, according to the data. In addition to this, the network’s hashrate has also increased significantly, currently reaching an all-time high of 1.07k TH/s.
Litecoin (LTC) has experienced a significant decline over the past 7 and 30 days, losing 16% and 28% of its value in the respective periods, trading at $62. According to our data, 24-hour trading volume also fell significantly by 40%, with $389 million traded at the time of writing.
Analysts say the large liquidations over the past few days are believed to be due to intense bearish pressure that pushed Bitcoin below the $55,000 price mark.
Similar to the price trend, Litecoin miners have also been steadily selling off their coin holdings since March 28th. At the time of writing, only 1.61 million LTC ($120 million) was held in the miner stockpile, which represents a 29% decrease and is the lowest on record. Number of coins held across Litecoin mining pools since December 2011.
According to our research, Litecoin miner reserves measure the assets held in the wallets of affiliated miners. Mathematically, a decrease from the actual amount means that coins were distributed to cover profits or mining costs.
According to our findings, the significant decline in miner reserves has been accompanied by an increase in the network’s hashrate, which now reaches an all-time high of 1.07k TH/s. For education, this represents a global Litecoin network hash rate with a block height of 2,715,496 and a mining difficulty of 35.56 M.
What network activity means for the ecosystem
Historically, the rise in hashrate associated with a decline in miner reserves is believed to be due to two main reasons. First, existing miners will promote most of their cash while new miners may flow in. Second, miners are anticipating future price increases and may hold some of their mining assets while selling some to cover mining costs.
This is expected to put downward pressure on LTC prices in the short term. Prior to this bear market, analysts World of Charts suggested that LTC could stage a breakout to $400 in the coming months.
LTC breakouts and retests have already been confirmed. Submit towards $400 now… Breakout and retest are almost complete. #LTC appears to be gearing up for a solid bullish rally next week. Submit towards $400.
At the time, analysts observed that on-chain metrics such as the MVRV ratio were showing bullish sentiment, suggesting that the asset was not yet overvalued.
Currently, the hourly price chart confirms that the bulls are inducing buying pressure to offset the dominance of the bears, which could lead to a massive bullish reversal. Against the backdrop of ongoing market sentiment, analysts believe that Litecoin could be a good choice in the long term and could reach $1,000 soon if it continues to see solid activity and growth. That’s what I think.
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