Litecoin’s blockchain is set to undergo a mining reward halving in August this year, as it is programmatically designed to do so after every 840,000 blocks are mined or roughly once every four years.
The process is aimed at controlling inflation by reducing the rewards for mining on the blockchain from 25 coins to 12.5 coins and seems to have put a strong bid under the cryptocurrency.
Litecoin has scored gains in each of the previous four months – its longest monthly winning streak since August 2017. Prices rallied 3.8, 46.3, 31.15 and 22 percent in January, February, March and April, respectively, according to CoinDesk data.
Why does the halving matter? Associating litecoin’s rally with the reward halving makes sense as the process results in reduced production of the cryptocurrency’s supply. Miners will be earning 50 percent fewer coins for every block mined after August and will be adding significantly fewer litecoins to the software’s ecosystem, possibly leading to supply deficit.
Markets are always forward-looking and tend to price in such demand/supply-altering events often times several months in advance.
Backing that argument is historical data which shows the price of litecoin had rallied sharply in seven months leading up to its first reward halving, which took place on August 25, 2016.
I made a thorough and in-depth analysis yesterday, check out:
afreet77
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thank you clear it up ,i was lost ......But i hear they will dump before halving......
KryptoL0gCZ
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Crypto_Mercy
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Selle level?? At 117 ??
CopilotThe
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Pretty good and interesting content Igor!
tcap_tom
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Super clean chart, green line makes it easy to see why looking at the lows gives a good signal of what's to come. Any predictions on when LTC will test all time highs?