After 13 years of 100% uptime, the Litecoin network has evolved very well. All the on-chain metrics of Litecoin's blockchain indicates that there is a massive adoption on the market which is continuing to rise quickly. The Litecoin Network Value Model which was developed by @MASTERBTCLTC shows clearly the way of Litecoin adoption over all the years.
This model is based on the following values:
New Addresses
Total Addresses
Active Addresses
Total Volume USD
Transaction Count
# of Retail
The average line formed by all these aspects is colored white and represents the whole LTC Network Value.
Point of Splitting:
Around the Litecoin price and LTC Network Growth there is an anomaly which has caused the price to split off from the actual value of the entire LTC Network. But why does this happen?
I’ve already discussed this divergence in Part 1 of this article series: The Hidden Potential of Litecoin - Why It's Poised for a Parabolic Surge. (recommended to read before this one if you haven’t already)
I came to the conclusion that the cause of the diverging lines is a huge permanent sell-off by miners that has continued to this day. But why the miners are selling? To be honest – I don’t know.
It could be because the miners want to cover their costs of mining Dogecoin because Doge is merge mined together with Litecoin. But on the other hand, it would be very unwise if they don’t see Litecoin's potential and it’s huge network growth.
While miners are selling and the network is growing since point of splitting, price is stuck in the middle. No matter what reason they sell it for, this behavior will later lead to a massive supply shock and the LTC price will adjust to the real Litecoin network value after miners run out of supply or if they decide to hold again their mined LTC block rewards.
Because the network value is currently much higher than the price per LTC, theoretically price also would be at a much higher level today than we are seeing right now, if there wouldn’t be any sell pressure coming from the miners.
This correlation shows why it’s so important to know the fundamentals of a cryptocurrency. It’s the most important aspect to be able to identify the actual value of an asset and predict possible price increases in the future.
Price Prediction:
Based on the current level of the network value (average), the real price of 1 LTC would be around $8300 today if the price would instantly adapt to it’s network value.
Due to immensely rising network statistics the Litecoin price would easily grow into the 5-digit range in the next bull cycle when the heavy miner sell-off comes to an end.
An exact value is currently difficult to predict but in my point of view Litecoin could push to the $15000 - $40000 area until 2028. But until then enjoy the rise and let’s watch the great Litecoin Network growing in silence, hidden in the shadows...
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