On August 5, 2019, Litecoin went through its second block reward overhaul since its inception. One month later, we can clearly see the after-effects of such ‘shock’ as LTC founder Charlie Lee put it in July, in an interview, almost one month before the event. Did Litecoin halving produce the expected results? Was Lee right when he said miners would close their rigs in the aftermath? Let’s find out.
Before Litecoin Halving: Price Spikes In Anticipation
After reaching a local low in December of last year to around $23 per coin, Litecoin bounced back in 2019 as more and more cryptocurrency traders doubled down on their bets of a price spike before the halving. They had the historic price chart as evidence.
In 2015, before the first halving from 50 to 25 LTC per block reward, the Litecoin price moved upwards during the summer of that year from around $1.40 per coin in April to a local high of over $8.50 in July 2015. After that, the price plummeted to under $4 in a matter of days and continued the trend downwards to around $3.5 at that time of the event, on August 25, 2015.
After the halving, the Litecoin price stabilized to around $2.50 to $3 in the upcoming couple of months.
History Repeats Itself In 2019
2019 was more of the same story if we look at the price chart.
Bitcoin’s silver climbed from the lows in December 2018 to double the price to start the spring. By April, Litecoin was already trading at over $90 and after a short dump to under $70, Lee’s ‘invention’ took off to local highs of $140 towards the end of June. That is around 6x or 600% from the December lows, much like in 2015.
The similarities continue: after the local high, the price dumped around 45% and bounced back to around $90 – $100 range per coin as the second Litecoin halving was approaching.
On August 5, 2019, the event came and go and the block rewards were cut in half, from 25 to 12.5 LTC.
Charlie Lee praised the mining & price stability in the following days. Still, it wasn’t a smooth sailing towards the end of the month as the effects were more and more obvious.
Litecoin Price Plummets And So Does The Hashrate
Litecoin price went downwards to just over $60 around one month after the event, which is a 40% decrease. There was a price decrease after the first halving in 2015, as well, but no more than 30%. Obviously, the price targets and awareness between the two periods are totally different.
Interestingly enough, Lee was also right in terms of miners shutting down their rigs as an effect of the rewards cut in half. There was a spike in Litecoin’s hashrate in July but around August 5, 2019, the hashrate stabilized around 450 TH/s. After that though, the hashrate decreased at levels just over 300 TH/s. That’s just 30% less compared to the date of the halving.
Looks like Charlie Lee knew what he was talking about…
What’s your take on the latest Litecoin halving? Did you anticipate such price (and hashrate) action? Did you trade as a consequence? Tell us about it more in the comment section below.
Images courtesy of Flickr, CoinMarketCap & Bitinfocharts.