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The hashrate of Litecoin ($LTC), a cryptocurrency commonly referred to as the silver to Bitcoin gold, recently reached a new all-time high as its price continues to rise in anticipation of its impending halving event.
CryptoCompare stats show that Litecoin hashrate has reached a new record high of about 680 TH/s. Like Bitcoin, Litecoin employs a Proof-of-Work (PoW) consensus algorithm.
In order to add new blocks to the blockchain and receive rewards, the system pits miners against one another in a race to solve challenging mathematical puzzles. A fixed amount of coins are awarded to the miner who solves the problem first in this process of problem solving, which is known as mining.
The amount of hashes (mathematical puzzles) that can be solved in a certain amount of time is known as the hashrate. A greater hashrate indicates that more miners are engaged in the mining process and that the network is more secure. Additionally, a greater hashrate makes it more challenging for malicious users to control the network.
A short time after LTC price increased by almost 50% over the previous three months to trade above $80 per coin, the network hashrate increased.
Litecoin experiences halving events, where the coinbase reward for miners that discover blocks on the network is halved, similar to how BTC does. The next Litecoin halving event, which will cut mining payouts from 12.5 LTC to 6.25 LTC, is anticipated to take place in August 2023. Events that reduce new supply on the market by half are considered bullish since they do so.
Litecoin price may increase months after its halving event, according to historical data, to the point where it reaches a new all-time high next year, as CryptoGlobe reported. But right after the halving, the cryptocurrency can experience a decline.
Rekt Capital, a well-known cryptocurrency analyst, found that Litecoin trends to rise pretty substantially before its halving, climbing 820% after hitting rock bottom 122 days before its first halving and 550% after bottoming out 243 days before its second halving.
In the past, the coin experienced greater gains following a halving occurrence. LTC experienced a 12,400% increase after its first halving and a 1,573% increase after its second halving.
Late last year, after more than two weeks of accumulation by huge addresses holding between 1,000 and 100,000 LTC, the price of Litecoin increased while outperforming the market.
It is crucial to note that analysts views on the subject differ, and it is not certain how halving events will affect a cryptocurrency price. A cryptocurrencies performance in the past does not guarantee its performance in the future.