It’s been known for some time that the success of many cryptocurrencies is backed by substantial institutional investments. Litecoin seems to be one such case, gaining increasing recognition in the eyes of Grayscale – one of the leading institutions investing in the crypto market.
Although many perceive Litecoin as Bitcoin’s “younger brother”, it has recently been gaining significance. This is certainly due to the growing interest from Grayscale, an institution whose influence on the world of cryptocurrencies is immeasurable. This is confirmed by the recent news of Litecoin’s inclusion in the FTSE Grayscale Crypto Sector Index Series. This index was recently created as a result of a collaboration between FTSE Russell and Grayscale.
Initially, only four cryptocurrencies were included in this index, and Litecoin had the honor of being one of them. Although being in the index doesn’t guarantee an increase in demand, it does indicate the growing interest of institutional investors in Litecoin. This, in turn, can benefit the long-term demand for this cryptocurrency.
Since mid-September, Litecoin has been experiencing a rather optimistic period. Over the past week, its value has risen by over 20%. This is the latest attempt to break price stability that lasted since the second half of August. However, despite these gains, Litecoin faces short-term price resistance, which may indicate some challenges.
On-chain data suggests that the largest holders of Litecoin began to take profits after the recent price increase. Addresses holding from 100,000 to 10 million LTC have reduced their holdings in recent days. This indicates profit-taking by the so-called “whales”.
Recent observations show that we might have seen a classic case where big players inflate the price to attract retail market liquidity. Although selling pressure from the whales may increase the likelihood of a correction, it’s also worth paying attention to the holding level and selling pressure.
The MVRV indicator for Litecoin recently reached a new monthly peak but has since retreated. This confirms that coins held for a while are starting to change hands.
While the short-term future of Litecoin might be uncertain, the long-term prospects seem promising, especially in light of the growing interest from major players like Grayscale. After all, in the world of cryptocurrencies, what happens behind the scenes often has the most significant impact on the future.
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