Binance publishes four potential outcomes of the Litecoin halving

19 Apr, 2019 | Updated: 19 Apr, 2019
by Richard Allen
Analysis
Binance publishes four potential outcomes of the Litecoin halving

Binance Research, the market analysis arm of major crypto exchange Binance, has published a report on some of the likely implications of Litecoin’s halving. Titled Litecoin’s 2019 Halving Scenarios, the report takes a look at four potential scenarios.

Litecoin’s halving, which will decrease its block rewards from 25 LTC to 12.5 LTC per block, is scheduled to take place on August 6, 2019. Binance Research explains their interest in the potential outcomes stems from the many similarities between Litecoin and Bitcoin.

According to the report, there are four potential scenarios:

1. A price rally that pushes mining profitability to levels approaching its pre-halving long-term average

2. An increasing hashrate in the months prior to the halving

3. A self-adjustment mechanism where price doesn’t really, leading to miners exiting the market, resulting in lower block difficulty leading to higher profitability.

4. A permanent drop in mining profitability.

The report analyzes past halving events in an effort to provide context for the upcoming halving. Throughout Litecoin’s eight-year history, it has undergone one precious halving which resulted in the price of the coin rising from $1.5 to over $3. In the months leading up to the event, the overall volatility of the asset increased as well.

“Litecoin’s previous halving was preceded by a large price rally with an increase by more than 200% (and spiking by over 500% over the 3-month period before),” the report notes.

Considering Litecoin is already up by 200%, a repeat of the original scenario isn’t out of the question.

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Read more about: Litecoin (LTC)

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