Litecoin (LTC) Analysis: Price Drops to $94 Amid Hash Rate Surge and Institutional Buys

Litecoin (LTC) has dropped to $94.54, marking a 13.01% decline in the past 24 hours and a 21.40% decline over the past week. 

With a market cap of $7.16 billion and a circulating supply of 75 million LTC, the recent sell-off is part of a broader market weakness. Bitcoin’s drop below $100,000 for the first time in two weeks has also contributed to Litecoin’s decline.

Despite the downturn, blockchain analytics platform IntoTheBlock reports that 78% of Litecoin addresses have held their coins for over a year. This long-term holding trend has typically seen accumulation during bear markets and selling near peak prices. 

The platform also notes that the decrease in long-term holdings this cycle is smaller than in previous cycles, suggesting that many holders expect further price growth.

Litecoin Hash Rate Reaches All-Time High

Litecoin’s hash rate has climbed to a record 1.84k TH/s, surpassing its 30-day average of 1.53k TH/s and the previous high of 1.77k TH/s. This surge reflects growing mining activity and increased network security. 

Miners remain confident in Litecoin’s long-term potential, as evidenced by the sustained growth in hash rate despite price volatility.

The higher hash rate aligns with Litecoin’s historical reputation as a stable network. The increased mining activity supports network stability and may reassure investors of its resilience during market corrections.

Institutional Interest Grows as Grayscale Buys the Dip

Grayscale Investments has continued to accumulate Litecoin despite its price drop. Data from CoinGlass shows that the firm purchased 2,230 LTC on Thursday, adding to its 30-day total of over 41,100 LTC. Grayscale’s total Litecoin holdings now exceed $220 million in value.

This accumulation indicates institutional interest in Litecoin, even during periods of market weakness. Grayscale’s activity has sparked speculation about the potential filing for a spot Litecoin ETF in 2025. 

According to Bloomberg’s Eric Balchunas, Litecoin’s similarities to Bitcoin and the SEC’s classification of LTC as a non-security could make it easier for an ETF approval.

Technical Analysis Points to Further Price Weakness

Litecoin’s daily chart reveals bearish momentum, with the price trading below both the 9-day and 26-day moving averages.

The MACD indicator shows a bearish crossover, signaling increased selling pressure. This momentum suggests that Litecoin could see further declines in the near term.

The RSI currently sits at 39.56, moving into bearish territory but not yet oversold. If the RSI approaches the 30 level, it could indicate a potential price rebound. 

Key support levels to watch are $90 and $80, while resistance remains near $115. Traders should monitor these levels closely as Litecoin navigates its current correction phase.

FAQs:

Why is Litecoin’s price dropping?

Litecoin’s price decline is linked to overall market weakness, including Bitcoin’s drop below $100,000.

What is the significance of Litecoin’s hash rate increase?

The record hash rate of 1.84k TH/s indicates higher mining activity and stronger network security.

What does Grayscale’s LTC purchase mean?

Grayscale’s accumulation shows continued institutional interest and raises the likelihood of a spot LTC ETF filing.