Lorenzo Stroe
Independent Analyst
- Litecoin price is currently $86.76, but some investors are paying a lot more to purchase the digital asset.
- The Grayscale Litecoin Trust is trading at a premium of 3,193% to NAV.
Grayscale is known for its massive investments in Bitcoin, but the trust fund has also purchased Ethereum, Litecoin, and other digital currencies in the past. Institutional investors are currently paying a lot more for the LTCN shares than the real value of Litecoin, which is around $86.
The chart of the Grayscale Litecoin Trust Premium to NAV shows 3,193%, which means that investors are effectively buying LTC at an implied price of $2,750.
Can Litecoin price benefit from the massive premium institutional investors are currently paying?
In the past four months, the price of LTC and the Grayscale Litecoin Trust Premium to NAV have been directly correlated. The last spike happened around the beginning of November. Litecoin price had a 72% increase since then.
The correlation between the LTCN shares and Litecoin price doesn’t necessarily seem to be benefiting the digital asset. On August 31, LTCN shares were worth $1.95 and spiked to $42.15 on September 1. On the other hand, the price of Litecoin dropped from $64 to a low of $45 three days later, representing a 29% decline.
LTC/USD daily chart
However, from October 20 until the current date, the correlation does seem to be positive. Despite this correlation, Litecoin price is already on par with the LTCN shares, which would suggest it will not necessarily continue growing.
LTC/USD weekly chart
On the weekly chart, Litecoin price has confirmed an uptrend after establishing a clear higher low at $41.64, compared to $25 and a higher high at $90.98 compared to the last high at $69. The significant resistance level at $80 was also broken on November 16. Litecoin seems to be aiming for $145 now.
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended Content
Editors’ Picks
Dogwifhat price pumps 5% ahead of possible Coinbase effect
Dogwifhat (WIF) price recorded an uptick on Thursday, going as far as to outperform its peers in the meme coins space. Second only to Bonk Inu (BONK), WIF token’s show of strength was not just influenced by Bitcoin (BTC) price reclaiming above $63,000.
Runes likely to have massive support after BRC-20 and Ordinals frenzy
PUPS, WZRD, and PEPE are gaining liquidity through Bitcoin Ordinals. Creator of Bitcoin’s Ordinals protocol is debuting a new fungible token standard to rival BRC-20, Runes.
Ethereum shows firm support at key level as its correlation with US indices increase
Ethereum's price continued a sideways movement on Thursday as the market still awaits a trigger. Ethereum isn't alone in this horizontal trend; several major index funds have also traded sideways.
Mango Market attacker convicted of fraud and market manipulation
Mango Market attacker Avi Eisenberg was convicted by a federal jury on Thursday for "fraudulently obtaining" funds from the Solana-based decentralized exchange (DEX). He could face up to 20 years in prison for his role in the $110 million attack.
Bitcoin: BTC’s rangebound movement leaves traders confused
Bitcoin (BTC) price has been hovering around the $70,000 psychological level for a few weeks, resulting in a rangebound movement. This development could lead to a massive liquidation on either side before a directional move is established.