- In at least two references made in the Binance lawsuit, CFTC recognized that LTC was a commodity
- The MVRV Ratio indicated that most LTC holders will realize profits on their sales
One of the biggest beneficiaries of the bull cycle of 2023 has been Litecoin [LTC]. The coin of the proof-of-work (PoW) chain has logged gains of over 28% on a year-to-date (YTD) basis and nearly 12% over the last seven days of trading, data from CoinMarketCap showed.
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A look at LTC’s mining data reverberates similar sentiments. As per Coinwarz, LTC’s hash rate has been climbing steadily and touched its all-time high of 771 TH/s on 26 March, an indication of growing network traffic.
And now the LTC fanbase has more reasons to cheer than ever.
LTC finds relief from regulators
The lawsuit initiated by U.S. Commodities and Futures Trading Commission (CFTC) against the Binance ecosystem may have shaken up the broader crypto market, but LTC was quick to look at the brighter side of things.
In at least two references made in the lawsuit, CFTC recognized that LTC was a commodity. The much-needed clarity for LTC comes at a time when the storm surrounding the status of cryptos, which has engulfed coins with a higher market cap like Ripple [XRP], is raging.
Whale holdings provide the cushion
Large addresses seemed to have jumped on the LTC bandwagon, data from Santiment highlighted. Transactions worth $100,000 or more increased by 23% in the past 24 hours.
Furthermore, there has been a continuous increase in addresses holding between 10,000 to 100,000 coins throughout the course of March. This happened despite LTC shedding 7% of its value month-to-date (MTD). Hence, it can be deduced that whales took advantage of the dip to accumulate more tokens.
On the flip side, the daily active addresses trading LTC fell by as much as 34% since mid-March. The 30-day MVRV Ratio indicated that the network was overvalued and most holders would realize profits on their sales. A large chunk of these holders was long term, as confirmed by the increasing MVRV Long/Short Difference.
How much are 1,10,100 LTCs worth today?
Hence, an imminent sell-off was unlikely as most of them will position themselves for further gains considering the latest regulatory relief.
Litecoin’s halving event is a little over four months away, which will be its third after 2015 and 2019. This could be another factor that could drive LTC demand and subsequent accumulation in the near term. Historically, LTC prices have soared in the aftermath of the halving. It remains to be seen how the ‘silver to Bitcoin’s gold’ will perform.