Litecoin (LTC) may have slipped out of the list of the top-20 cryptocurrencies by market cap. Even so, it might be one of the most undervalued coins right now. In fact, it might turn out to be among the best coins with the most potential for a strong bounce back during the next bull market.
Litecoin may not have been the best performing cryptocurrency during the relief rally in June and July. However, investors should still consider adding it to their portfolio. Why? Well, for starters, the total number of addresses grew steadily over the last 6 months. This is a sign of healthy demand, despite its price taking a huge hit during this period.
Litecoin had a $3.73 billion market cap on 26 August and 151 million total addresses. If we divide the market cap by the total addresses, we find that the network’s value per address is $24.
To put it into perspective, Bitcoin’s network value per address is $380 and Ethereum’s is $1,126. Uniswap is closer to Litecoin by market cap and its network value per address is $4,210.
Source: Glassnode
The comparison between the aforementioned networks hammers home the point that Litecoin is undervalued. Ergo, it might have the most potential for growth in the short and long-term.
At the time of writing, for instance, LTC was trading at a significant discount, just like most top cryptocurrencies. In fact, it was trading at an 87.2% discount from its ATH.
Source: Glassnode
LTC’s Coin Days Destroyed metric also revealed that there are a lot of unspent UTXOs, especially at its trading price. This is a sign that many investors are hodling their coins, although there have been some instances of short-term profit taking.
Litecoin’s short-term and long-term outlook
Litecoin’s $52.56 press time price tag underlined marginal gains from its 2022 low on the charts. Nevertheless, it is still close to the bottom and could still seek more downside in the current bearish market environment. This, because Litecoin is strongly correlated with the rest of the market.
On the flip side, Litecoin’s undervalued nature might make it one of the most attractive cryptocurrencies when the bear market is over. Other attributes such as its focus on privacy and decentralized nature are additional advantages.