Litecoin price has held the $70 territory for the last 3 consecutive days, for the first time since August. On-chain analysis pinpoints the critical drives behind the ongoing Litecoin price rally.
Litecoin price has struggled to find a steady flow of market demand amid the ongoing crypto market rally. However, some on-chain data trends suggest that could soon change as 2024 draws closer.
Litecoin Funded Addresses Has Grown Rapidly in H2 2023
Mega-cap coins like Bitcoin (BTC) and Solana (SOL) have delivered yearly gains of more than 100%. Meanwhile, Litecoin price has only managed recently to erase losses and reclaim $70.
On-chain data shows that Litecoin’s recent price recovery has been driven majorly by a steady growth in network demand. Firstly, blockchain data analytics platform IntoTheBlock reports that the number of Funded LTC wallets has increased by 44,000 since the start of H2 2023.
The chart below illustrates that Litecoin now counts 9.21 million non-zero addresses, up from 8.77 million on June 30.
The Funded Addresses metric is also oftentimes called non-zero balance addresses. When it increases, as observed above, it indicates growing adoption and expansion of the blockchain network.
If the funded addresses keep growing, the rising demand could push the Litecoin price toward the $100 mark as 2024 approaches.
The Network is Attracting a High Number of Transactions From New Users
In further confirmation of the growing network demand, Litecoin has experienced a significant increase in New User transactions this month.
According to IntoTheBlock, the New Adoption Rate on the Litecoin network reached a 1-month peak of 49.44% on November 4. This brings it well above the 30-day average of 44.26%.
The New Adoption Rate metric measures the percentage of active addresses that made their first-ever transaction on a given day. This provides clear insight into the rate at which new investors are entering the Litecoin network.
In summary, increased funded addresses and the growing traction from new investors affirm that Litecoin is experiencing organic network growth. If it evolves into explosive market demand, it could drive LTC price toward $100.
From an on-chain standpoint, LTC’s recent price breakout above $70 was driven mainly by organic network growth. And with these metrics still trending upward, Litecoin is in a prime position to extend its gains toward $80.
The Global In/Out of the Money (GIOM) data, which groups the current Litecoin holders according to their entry prices, also confirms this bullish prediction.
It, however, shows that LTC must first scale the initial resistance at $76 for the bulls to be confident of reclaiming $80. As depicted below, 364,400 holders had bought 4.53 million LTC at the average price of $75.99. If those holders close their positions early, they could slow down the Litecoin price rally.
But if the bulls can push aside that resistance level, Litecoin price will likely reclaim $80 as predicted.
Yet, the bears could negate the optimistic prediction if the LTC price reverses below $65. But, in that case, the 447,640 LTC holders that bought 4.83 million LTC at the minimum price of $67 could mount a support wall.
If those investors can HODL firmly, Litecoin will likely avoid a significant price retracement.
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.