Can Litecoin (LTC) Long-Term Holders Trigger a Price Recovery?

On Sept 11, Litecoin’s (LTC) price dropped below $60 for the first time since the infamous FTX crash in November 2022. On-chain analysis examines if the growing optimism among LTC long-term investors could be enough to trigger a Litecoin price rebound. 

In November 2022, the infamous FTX Exchange crash saw Litecoin’s price tumble 33% from $73 to $50. However, as long-term investors held on, LTC made a rapid recovery, hitting $85 before the end of the year. Recent on-chain data trends suggest a similar script could play out again in 2023. 

Long-Term Holder Addresses Surpass 5 Million For the First Time

On September 10, 2023, the number of long-term holder addresses hit a new all-time high of 5.02 million wallets. This marks an increase of 602,000 addresses since the LTC price dropped from its 2023 peak of $114.5 around July 2. And during that period, their holdings increased by 3.2 million LTC. 

Notably, this mirrors the Litecoin long-term holders’ reaction during the FTX crash, when long-held wallets increased by 150,000 between November 6 and December 5. 

In crypto terms, “Long-term Holder” refers to wallet addresses that have held their coins unmoved for at least 1-year. Hence, this 4.5% increase in the percentage of coins controlled by long-term holders could inspire some confidence across the Litecoin ecosystem.

It indicates that despite the price downtrend, many existing network participants remain confident in the long-term viability of the Litecoin project.  

Whale Investors Have Started Buying the Dip 

Aside from the long-term holders,  Litecoin whales holding balances of 10,000 to 100 million LTC have also started showing some optimism. Santiment data shows that the whales halted their week-long selling frenzy to buy 40,000 LTC in the last two days. 

The chart below illustrates how the whales have increased their cumulative balances from 46.63 million to 46.67 million LTC between September 10 and September 12. 

With prices currently hovering around $60, the new inflows of 40 million coins are worth approximately $2.4 million. Whale investors are individuals or corporate entities that hold a significant amount of a particular cryptocurrency, ideally balances worth $100,000 or more. Due to their substantial holdings, their trading activity often moves the markets significantly. 

With cumulative balances of 46.67 million LTC, the whale cohort identified above currently controls 56% of the total Litecoin circulating supply of 84 million coins. 

Hence, if they sustain their ongoing buying trend, they could absorb the bearish pressure and also shore up confidence among other investors. 

LTC Price Prediction: The $50 Support Remains the Key Level to Protect

From an on-chain perspective, the LTC support wall mounted at the $50 territory during the FTX crash still remains firmly in place. The Exchange On-chain Market Depth, which shows the current price distribution of active Litecoin buy/sell orders, also affirms the stance. 

It shows that around $50 or 20% less than the current LTC market price of $60, buy orders significantly outweigh sell orders. As seen below, the buy-wall of 296,030 LTC mounted at $55 will offer initial support. But if the bears overcome that support level with their 303,370 sell-orders, LTC price could drop slightly further, 

But if the long-term investors continue to HODL as predicted, the 417,870 LTC buy-orders listed around $50 will likely trigger a rebound. 

Still, if the bulls gain momentum, they could force a move above the $80 range. However, as shown above, the 303,370 LTC sell-orders listed around $65 will pose initial resistance. But if the whales keep up their ongoing buying trend, LTC price could scale that sell wall and head toward $80.