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Saturday, June 8, 2024
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LTC and ETH are undervalued and could move higher in the medium term

It’s unusual to see Litecoin outperformed Ethereum but on June 6, the number of active addresses on the Litecoin network spiked 75% to 302,720, marking the highest level of activity on the network since January and eclipsing Ethereum by 100,000 addresses.

Source: X

After Cardano, Litecoin takes down Ethereum

Active addresses measure the number of unique wallets participating in successful transactions on the blockchain. A few days ago, Litecoin surpassed Cardano in this aspect.

Onchain data analytics company IntoTheBlock said:

“While the majority of the increase was due to transactions smaller than $10, there was a notable increase in transactions of all sizes.”

It is worth noting that the increase in network activity cannot drive LTC price. At the time of writing, Litecoin is trading below $80 after falling nearly 5% in the past 24 hours.

Litecoin’s market capitalization to thermocap ratio, where thermocap is the total value of all coins in the network calculated as the current value of each coin multiplied by its “heat” depth – i.e. the number times the coin has been moved onchain, is currently 0.00000003 – low compared to Litecoin’s overheating periods, indicating that LTC is currently undervalued.

When the rate spikes, it means the coin is trading at a premium relative to miner spending, signaling potential overvaluation. In the past, whenever Litecoin’s ratio reached extremely high values, it caused a correction.

Source: Glassnode

Besides, Litecoin’s 30-day Market Value to Real Value (MVRV) ratio – used to evaluate the current value of a cryptocurrency compared to its “realized” value, i.e. the value of coins that have been moved onchain – is currently 13.35%, showing that the average holder would be profitable if sold now.

Source: Santiment

For Ethereum, the 30-day MVRV ratio is 4.69%. While this suggests that ETH and LTC may be in similar positions, it also suggests that Litecoin hodlers may be in a better position than their Ethereum counterparts.

In the medium term, ETH has the potential to surpass the psychological $4,000 threshold while LTC could break the key $100 resistance level.

You can see coin prices here.


According to AMBCrypto

Mark Tyson
Mark Tyson
Freelance News Writer. Always interested in the way in which technology can change people's lives, and that is why I also advise individuals and companies when it comes to adopting all the advances in Apple devices and services.


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