Recent trends of Litecoin ($LTC) align with the overall sentiments of the crypto market. The rate cut has equally boosted its token value by 5.87% in the last seven days. That is sufficient to balance the correction of 1.72%, which has come in the last 24 hours at the time of writing this article. LTC’s short-term fluctuations are less likely to dent its long-term potential. Litecoin price currently stands at $66.71, with the capability of surpassing $100 by the end of this year.
It is still imperative to understand short-term fluctuations as they do build a foundation for long-term growth by setting a pace.
2 Factors that will Determine Litecoin’s Short-Term Price
While several factors affect the price of Litecoin or any other cryptocurrency, the focus is on Institutional Demand, LTC Hashrate, and Litecoin Network Growth. Hashrate refers to the computation power, or the speed of mining, that facilitates the supply of a token, LTC in this case. Network growth entails elements like market size, institutional interest, and activity, to mention a few.
1. Institutional Demand
One key factor influencing short-term LTC price is institutional demand. This includes the level to which institutions are accumulating or acquiring the token. Grayscale and Fidelity are on the list as key institutions that have demonstrated interest.
Grayscale is seen accumulating LTC even at times when dubious sentiments surround it. Or at times when the market crashed at the beginning of August. If anything, that ended up instilling a sense of confidence among LTC holders. Grayscale did not hold itself back from accumulating Litecoin tokens and now has almost 1.85 million LTC in its portfolio. This is up from 1.75 million in just four weeks.
The approach by Fidelity is different, for it has granted exposure to its clients to LTC. Fidelity has a large user base and has backed its ecosystem with over $12 trillion AUM, that is assets under management. These attract interest from retail investors. Thereby, boosting Litecoin price prediction to a new high.
Grayscale and Fidelity’s approach will affect short-term LTC movements on price charts. Investors would want to follow the trail on the assumption that there is a better future for Litecoin that awaits.
2. Hashrate and Network Growth
Institutional demand is actively engaged in accumulating LTC tokens. Meanwhile, Litecoin hashrate and network growth are contributing to the rising interest in short-term sentiments.
Hashrate soared to 1.29 PH/S in just 24 hours. It has built over years of constant growth and is speculated to keep moving with an upward trajectory. There was a descending long-term resistance, with the native token being bearish for five consecutive days. A rise in hashrate is now backing expectations for a bullish relief. Pivoting to a bullish side will set the support level at $66, followed by $70.50.
Network growth is one of the underappreciated aspects simply because it covers a broader spectrum of the ecosystem. Litecoin Network recently surpassed one quadrillion hashes per second, which has been termed an exclusive landmark. It means that it is now processing over 1Q hashes every second. The development was officially reported by Litecoin on X. This highlights security and the rising resilience of the Litecoin network for unparalleled expansion.
The higher the hashrate points, the higher it reflects on the security of the network and the more difficult it gets for malicious actors to hamper the ecosystem. Suffice it to say there is a correlation between hashrate growth and the potential for LTC’s price recovery.
Other Influencing Factors
Some more Litecoin price drivers are regulations and altcoin market trends. Authorities being too stringent with regulations tends to affect the growth of Litecoin and every other similar project. What adds to that is the complexity behind those regulations for the part that is under-recognition. Investors find it difficult to understand the actual implications and, therefore, decide to stay away from it altogether. Needless to say, it goes on to pull down LTC’s value.
Altcoin market trends boost the chances of cryptocurrencies other than BTC and ETH in some cases. A shift from giant players to other tokens opens the doors for a price surge as investors flock to new territory to explore diversifying their portfolios.
Conclusion
Two key factors affecting short-term projections of Litecoin ($LTC) are institutional demand and hashrate & network growth. There is a direct relation between them, and it is important to understand those differences to safeguard one’s interest in the market. It is highly recommended that investors, or interested investors, follow institutional demand and network metrics to gain deeper insights into price movements.