Litecoin Hits a One-Month High

Litecoin has been gaining popularity and value in recent weeks, thanks to several factors that have boosted its appeal among investors and users. One of the main drivers of Litecoin’s price surge is the high transaction fees on the Bitcoin network, which reached an average of $30 per transaction on May 8, 2023.

This has made Bitcoin less attractive for small and frequent payments and has pushed some users to look for other options.

Why is Litecoin Outperforming Other Cryptos?

Litecoin, which has a block time of 2.5 minutes compared to Bitcoin’s 10 minutes, offers faster and cheaper transactions, with an average fee of less than $0.01 per transaction. Litecoin also has a higher transaction capacity than Bitcoin, as it can process 56 transactions per second compared to Bitcoin’s 7 transactions per second.

Another factor that has contributed to Litecoin’s rally is the anticipation of its upcoming halving event, which is expected to occur in late July or early August 2023. A halving is a process that reduces the reward that miners receive for securing the network by 50%, which in turn reduces the inflation rate and the supply of new coins.

Halving events are seen as bullish for cryptocurrencies, as they create a scarcity effect and increase the demand for the coins. Litecoin’s halving will reduce the reward from 12.5 LTC per block to 6.25 LTC per block, which will lower the annual inflation rate from 4% to 2%.

Tokens Have Been a Positive Influence

Litecoin’s price has also been influenced by the rise of meme coins and BRC-20 tokens on the Bitcoin network, which have increased the congestion and costs on the blockchain. Meme coins are cryptocurrencies that are created for fun or as a joke, such as Dogecoin (DOGE) and Shiba Inu (SHIB).

These new tokens have attracted a lot of attention and speculation from investors, but they have also caused some problems for the Bitcoin network. The increased demand for these tokens has resulted in higher competition for block space and higher fees for transactions. This has made some users switch to Litecoin, which has a more scalable and less congested network.

Litecoin’s price outperformed other top cryptocurrencies in May 2023, reaching a one-month high of $91.65 on May 19. This represents a 20% increase since May 8, when Bitcoin fees hit $30. Litecoin’s market capitalization has also grown to $6.7 billion, making it the 11th-largest cryptocurrency by market value.