Grayscale Buys Litecoin as Prices Drop: Will LTC Rebound?
After the Federal Reserve FOMC meeting, the cryptocurrency market crashed, and the price of Litecoin (LTC) also fell. This decline was due to the Fed's tough decision to reduce the expected number of interest rate cuts in 2025 from four to two. Grayscale Investments seems to be taking full advantage of this decline by purchasing LTC. Will this institution-led buying frenzy, combined with hopes for a spot LTC ETF, trigger a rebound in Litecoin?
Grayscale buys LTC on dips, will the price of Litecoin rebound?
After the market crash, the current price of Litecoin is $109, down 25% from this year's peak. This drop is mainly related to the continued weakness in the cryptocurrency market, with Bitcoin's price falling below $100,000 for the first time in two weeks.
Despite Litecoin's sharp decline in the short term, Grayscale Investments is still buying. Data compiled by CoinGlass shows that the company bought 2,230 Litecoins on Thursday, bringing its total holdings to over 41,100 Litecoins in the past 30 days. The total value of the Litecoins held currently exceeds $220 million.
Is a spot Litecoin ETF about to be launched?
Grayscale's purchases have increased the likelihood of the company's application for a spot Litecoin ETF in 2025. Just this week, Bloomberg ETF research director Eric Balchunas pointed out that since the LTC ETF is similar to Bitcoin, it will have an easier path to approval. If true, this event could catalyze a significant rise in Litecoin's price.
Litecoin is a hard fork of Bitcoin and shares some similarities with Bitcoin, such as halving and a fixed supply cap. The U.S. Securities and Exchange Commission also does not consider Litecoin a security, which would simplify its ETF approval.
Grayscale accumulating LTC is a good sign, as it is one of the largest creators of cryptocurrency exchange-traded funds.
LTC Hash Rate Hits All-Time High
Meanwhile, Litecoin's hash rate has surged to an all-time high, indicating an increase in mining activity. Its hash rate has risen to 1.66 TH/s, above the 30-day average of 1.52k.
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