simply put
Litecoin (LTC) price is holding the $90 support level despite growing negative sentiment surrounding the upcoming halving event.
Litecoin has seen a surge in the number of daily active addresses this week, suggesting an upcoming increase in transaction activity.
On-chain data shows that Litecoin miners have injected 400,000 LTC into their cumulative reserve balance.
Litecoin (LTC) price has held support at $90 this week despite negative sentiment surrounding the upcoming halving event. Can LTC avoid a historic post-halving crash?
Historical price data from 2015 and 2019 shows that Litecoin prices tend to plummet once the halving event approaches. However, on-chain data suggests that things may be different ahead of this year’s expected halving date of August 2.
Litecoin miners stockpiling reserves ahead of halving date
The upcoming and much-anticipated Litecoin halving event will cut miners’ block rewards in half, from 12.5 LTC to 6.25 LTC. In preparation, miners have been accumulating reserves.
On-chain data compiled by IntoTheBlock shows that LTC miners have increased by 400,000 between July 1 and July 28.
This brings their total reserves to 2.3 million LTC, worth approximately $207 million at the current price of $90.
The miner reserve data tracks the wallet balances of recognized miners and mining pools. When it goes up, it means miners are holding on to more block rewards rather than selling them.
With their block reward set to halve to 6.25 LTC in less than a week, miners appear to be racing to accumulate as much of the current 12.5 LTC revenue as possible.
As fewer block rewards flow into exchanges, the resulting drop in market supply could help Litecoin avoid a post-halving crash.
Internet user activity rises again
Additionally, Litecoin has seen a significant increase in user activity this week. The Santiment chart below shows how Litecoin daily active addresses increased from 221,000 to approximately 303,000 active users between July 20 and July 26, a 37% increase.
Daily active addresses track real-time changes in network usage by aggregating the number of individual wallet addresses performing transactions. As observed this week, continued spikes in DAA could indicate an impending increase in transaction activity.
In summary, if LTC miners continue to hoard reserves and users begin transacting at higher volumes, the Litecoin price may accumulate enough momentum to avoid the perennial post-halving crash.
LTC Price Prediction: Is $95 a feasible target?
Considering the aforementioned bullish on-chain indicators, there is a good chance that Litecoin will avoid a post-halving crash. However, to have confidence in this prediction, LTC bulls must first break above the $90 resistance and attempt to turn it into support.
But as shown below, 1.42 million wallets purchased 15.03 million LTC at an average price of $90, which could prevent a potential rally.
However, the bullish pressure from miners intensifies and LTC may break through this resistance and eventually push towards $95.
Despite the underlying bearish pressure, the upcoming Litecoin halving could trigger a drop in the Litecoin price below $85.
However, with 1.55 million addresses holding 9.75 million LTC at an average price of $86.17, LTC price could find bullish momentum if it can break out and hold above this key price range.
However, if this support fails to hold, the LTC price could drop to $80.
