Litecoin New Update Not Sufficient To Keep Miners Going – Here’s Why
One of the ways to increase investors’ interest in crypto is network improvement. Developers of cryptocurrencies usually come up with improvement proposals to make the network efficient, accommodating the needs of the users and fixing issues hindering seamless transactions.
In a recent development, Litecoin released a network upgrade to improve its network security and fix critical issues affecting nodes.
The Litecoin Foundation announced the update named Litecoin Core 0.21.2.2 on March 2 and shared the information on Twitter. But it seems the update is insufficient to keep miners’ interest in the network high, given the drop in LTC price.
Litecoin Price Spike And Upgrade Encouraged Miners
LTC ended 2022 at $68. The same day, it recorded an intraday high of $70 and an intraday low of $67.79. The next day, January 1, LTC kicked off with positive price movements, pushing its price to $74 by day’s end.
The coin continued an uptrend until it hit $90 on January 14 and $101 on February 2. From February 3 to March 3, LTC traded between $80, $90, and $100 on some days.
At press time, LTC trades at $89, indicating a slight loss in 24 hours. But its trading volume is down by 48.42%, indicating slow activities with the coin.
Notably, the Litecoin Core 0.21.2.2 increased the growth of LTC mining. Coinwarz’s data shows that the network hashrate recorded a slight uptick, suggesting new miners rushed in.
Miners May Lose Interest Following Price Drop
However, LTC once recorded a price drop of 7% in 24 hours, scaring investors. Also, its daily chart indicates the presence of bears pushing the price. LTC’s Relative Strength Index (RSI) was headed below the neutral mark, and there’s also a downtick on its Chaikin Money Flow (CMF).
Another indicator is that the LTC price touched the lower part of the Bollinger Bands, indicating a move into a high volatility area. The MACD also shows a bearish move in the LTC market, indicating more bear runs in the coming days.
Currently, LTC chart indicators suggest an imminent price downtrend. The blockchain performance is also not encouraging, as its metrics look bad. Another worrisome issue is that the daily on-chain transaction volume for LTC declined. Coinmarketcap shows a decline of 48.56% in LTC trading volume.
Moreover, the demand in the derivatives market also plummeted as LTC recorded a sharp decline in its DyDx funding rate on March 3. With all these losses and indicators, the LTC market recorded negative sentiments decreasing investors’ confidence.
Analysts are worried that miners may also lose interest in the network if the price slumps. Besides, LTC struggles to mount on the daily candle as the momentum swings.