Litecoin And XRP Gain Momentum Amid Bitcoin Slump

Aug. 8, 2023
Litecoin And XRP Gain Momentum Amid Bitcoin Slump

Bitcoin (­BTC)­,­ the leading cryptocurrency,­ experienced a significant decrease in its investment products over the past week while Litecoin and XRP gained traction amidst Bitcoin’s decline,­ according to CoinShares,­ a renowned crypto asset manager.­

CoinShares reported that there was a significant $­107 million outflow from digital asset investment products last week. The main contributor to the outflows was Bitcoin,­ which recorded a substantial $­111 million in outflows,­ marking its highest level since March.­

Additionally,­ Ethereum,­ the second-­largest cryptocurrency,­ experienced outflows worth $­6 million. Therefore,­ the combined outflows from Bitcoin and Ethereum reached a total of $­117 million for the week.­

Investors’ disinterest in Bitcoin and Ethereum is evident from the recent outflows. Lacking significant positive news,­ these top cryptocurrencies have experienced a decrease in popularity.­

In contrast,­ XRP and Litecoin,­ two well-­established altcoins,­ have witnessed inflows as investors seek alternatives to Bitcoin and Ethereum. Over the past week,­ XRP received approximately $­0.­5 million, while Litecoin garnered around $­0.­46 million in investments.­

The influx of funds into XRP and Litecoin demonstrates investor confidence in these altcoins,­ particularly following the ruling on July 13 that clarified their non-­security status when traded on exchanges.­

LunarCrush, social analytics service, recently reported a significant surge in social engagement for Litecoin. In just one hour,­ there were an astonishing 2.­16 million social engagements for halving events,­ highlighting the widespread activity surrounding social posts.­

Litecoin Halving Boosts Network Fundamentals

The demand for Litecoin may have been boosted by its third halving event on Aug.­ 2 at block 2,­520,­000. This event reduced mining rewards from 12.­5 LTC to 6.­25 LTC per block,­ making Litecoin scarcer and more valuable.­

Despite limited price movement,­ Litecoin has maintained strong network fundamentals as indicated by its hashrate nearing a new all-­time high, according to a recent tweet. The current difficulty of 933.­2 TH/­s also approaches a new record for Litecoin.­

Both the hashrate and difficulty act as indicators reflecting the sentiment of the mining community. A higher hashrate signifies increased participation in the LTC network,­ enhancing security and stability.­

When Litecoin was first launched,­ the block reward for miners stood at 50 LTC. However,­ this amount underwent reductions during subsequent halving events. The reward was first decreased to 25 LTC and further reduced to 12.­5 LTC in the last halving event.­

Related Reading | FTX’s Dubai Unit Seeks Exemption from Bankruptcy Chaos

Prior to the recent halving,­ which occurred on August 2,­ 2023,­ the block reward remained fixed at 12.­5 LTC. As a result of this most recent halving event,­ the block reward has now been lowered to just 6.­25 LTC.­

Kashif is a crypto-journalist with over 4 years of experience in the Cryptoverse. He began his career as a software engineer, but his curiosity towards decentralized technology lured him into the labyrinth of crypto, where he discovered a passion for reporting the latest news and developments in the field.