​​Litecoin Defies Crypto Downtrend as It Books +60% Gains in Past 90 Days

Born as a fork of the Bitcoin network, its purpose was to create a more efficient blockchain that provides lower transaction costs and higher scalability to handle payments.

Although the token is trading -70.6% below its all-time high reached in May 2021, it is only -18.3% off its local top from December last year after its recent spike.

Market participants are expecting that the United States Securities and Exchange Commission (SEC) could soon approve a spot Litecoin exchange-traded fund (ETP), as the token’s technical characteristics and the network’s functioning is pretty similar to that of Bitcoin.

Three asset management companies – Canary Capital, Grayscale, and CoinShares – have already submitted applications for an ETF while the Nasdaq Stock Exchange also applied to list these vehicles.

As a result of the Nasdaq’s actions, the SEC has now only 45 days to issue an initial response and up to 240 days more to provide a definitive response.

The market seems confident that the regulatory agency will give this vehicle the green light, as reflected by how the token has been performing lately.

LTC Technical Indicators Say Buy

Litecoin is the 17^th most valuable token in the crypto market, according to data from CoinMarketCap. Its latest rally helped it overtake Hedera – another layer-one blockchain whose yearly losses pushed it behind the cart.

Currently, Litecoin’s market cap stands at $9 billion. The token has a maximum supply four times higher than Bitcoin, at 84 million. Of that total, only 75.5 million have been minted.

The Litecoin price chart shows that, despite the latest 90-day uptrend, the price has made a lower high already. This could be considered a sign of weakness in the short term.

However, as the price has been rising again in the past week, bulls have another chance to retest the latest resistance, which if surpassed, could reverse the current downtrend.

Momentum indicators are positive for LTC as the MACD shows that negative readings have been steadily decreasing. Moreover, the Relative Strength Index (RSI) has moved above the signal line.

This is a bullish setup that could propel the price to retest the trendline resistance a second time. Hence, the near-term target for LTC is around $128, which translates into a 6.8% upside potential for the token.

Meanwhile, a break above the trendline resistance would soon encounter another key resistance level at around $135 per coin. If the price breaks above that, the downtrend will be in full reverse mode and LTC could be poised to rise above its December 2024 high as a result.

Litecoin’s Network Capacity Nearly Doubles

According to data from BitInfoCharts, since the November 4 election, the Litecoin network’s computing power has almost doubled, moving from 1.2204 to 2.296 petahashes in less than four months. Comparatively, the network’s capacity expanded by just 34% in 2024.

During this same period, the Bitcoin network expanded its capacity by just 20.3%. This implies that miners have expanded their investments into securing the Litecoin network at a faster rate – possibly as profitability rates are higher and the network’s difficulty level is lower.

“The recent rally in Litecoin and Dogecoin, fueled in part by Elon Musk’s influence and the changing regulatory landscape in the US after the Trump win, has had a major impact on mining profitability,” said Dr. Youwei Yang, VP of Mining for BIT Mining in December last year.

BIT Mining is a crypto mining company that recently moved its operations from Shenzhen, China to Akron, Ohio. Back then, they announced that they would start mining Litecoin and Dogecoin apart from just Bitcoin.

Miners like BIT Mining could also be expecting a significant increase in transaction volumes once an LTC-linked ETF is approved, which would result in higher revenue in the near term.