Cryptocurrency exchange Kraken, in its new report, reminded that in December 2017, Litecoin (LTC) (LTC) increased by 638 percent from $ 50 to $ 369 in just 30 days. According to the crypto exchange, LTC is re-issuing on-chain signals that heralded its rapid and massive rally during the 2017 bull cycle.
In the said report, he explained the situation in the following terms:
“On-chain activity shows that network demand is starting to rise, preparing for the next rally while also staying below the 'overbought' zone.”
The critical on-chain metric that is on Kraken's radar is the number of active addresses, where it's been in a strong uptrend for about 12 months.
- First, the number of active addresses has been on a massive uptrend since December 2020, indicating that the network continues to see more and more activity amid a broader market rally.
- Second, the number of active addresses has been increasing recently, the sharpest increase in activity observed since April 2021 can be interpreted as a sign of a sudden burst in network demand and activity.
- Kraken adds that Litecoin (LTC) is also growing in the number of new addresses with non-zero balances.
The Litecoin report states:
“The 7-day moving average of new addresses (with non-zero balances) stands at an all-time high of 308,827. The 7-day moving average of new addresses continues to rise through November, surpassing the all-time high of 270K on October 9, 2021."
In addition to on-chain data, Kraken is also examining Litecoin's MVRV Z data, a metric that determines whether an asset is over or undervalued relative to its fair value. According to the report, Litecoin is currently far from overbought territory, even after the recent price increase.
"LTC's current MVRV Z score is just over 2 and will need to increase 3.5 times before reaching a reading of 7, or something historically considered 'overbought'."