A good old 'blue chip', Litecoin, has flipped Ethereum in terms of active addresses.

Take a look:

We might suggest that Ethereum's onchain activity is under pressure because of high fees, sure. But what's driving Litecoin in opposite direction? How could a UTXO cryptocurrency coin flip over the biggest DeFi and NFT ecosystems token, ETH? Apparently almost 600K (!) people are using LTC on a daily basis.

Next. An experimental metric, "Payment count", has broke 2017 bull run all time high:

This specific UTXO metric counts the number of addresses which are receiving Litecoins. And it's very close to count of active addresses.

Okay, LTC belongs to UTXO. May be it makes sense to compare it's onchain activity to Bitcoin. Let's see:

Looks legit. No flippening Bitcoin for sure. But still, 600K Litecoin active addresses daily is quite outstanding.

The question is who is using Litecoin?

Any ideas?

References:

• Walmart Litecoin fake news - https://edition.cnn.com/2021/09/13/investing/litecoin-walmart-scam/index.html
• FLOKI - https://investorplace.com/2021/09/elon-musk-sends-fshib-and-floki-cryptos-soaring-with-new-puppy-pic/
• Safemoon - https://twitter.com/safemoon/status/1437438507832778759
• Saylor and Microstrategy - https://bitcoinmagazine.com/business/michael-saylors-microstrategy-buys-5050-more-bitcoin-as-total-investment-exceeds-3-1-billion

While most top blockchains continue to struggle with an ongoing decline in daily network activity, Litecoin didn't seem to get the memo:

Despite a -13.8% drop in price, the amount of unique addresses interacting with LTC has grown by +47.5% over the last 10 days. Potential bullish divergence?

It's also worth noting that Litecoin's 365-day MVRV ratio is currently sitting at -39%, virtually the same level that marked the 2019/2020 bottom (respectively):

Historically speaking, there's still more room to the downside, but it'll be interesting to see if -40% gets confirmed as a de-facto 'bounceback' zone in days to come.

Oh, also, addresses holding 1k - 100k LTC have increased their holdings by 270,000 LTC (~$30m) since the start of the month:

Still early to tell, but I'd keep an eye on Litecoin's daily addresses this week. If the growth proves sustainable, it would be a rare example of network strength among crypto's top caps.

The BitMEX Perpetual Contract Funding Rate is an important way to gauge whether the crowd on one of crypto's top exchanges, is getting overly greedy or fearful.

The metric is defined on our Santiment Academy as a fee paid by one side of the perpetual contract to the other. When the funding rate is positive, Longs pay Shorts. When the funding rate is negative, Shorts pay Longs.

So in essence, as traders, we're looking for high funding rates (greed) to be indicative of a potential upcoming top, and low funding rates to indicate a potential bottom (fear).

Bitcoin

Ethereum

XRP

Litecoin

Chainlink

Bitcoin Cash

When volatility strikes, as it has in the negative direction over the past 3-4 days, many traders tend to display a phenomenon known as "freezing up". This behavior is exactly how it sounds - traders don't want to make a mistake and buy into a downswing or sell into an upswing.

However, whales of many altcoins tend to become much MORE active when prices begin to rollercoaster wildly as they have been as Bitcoin dipped to $53k this weekend.

Here are three assets we see with major whale numbers rising this past week, and conversely, falling:

⬆️ Increasing Number of Whale Address

Ethereum ($ETH)

Ren Protocol ($REN)

Band Protocol ($BAND)

⬇️ Decreasing Number of Whale Address

Celcius ($CEL)

Litecoin ($LTC)

Storj ($STORJ)

Network Realized Profit or Loss (NPL) calculates the overall ROI across all daily transactions for a crypto asset. Generally, spikes are what we look to avoid, as it implies increased chances of local tops and short-term price normalization.

So are we seeing major spikes to be worried about? Here's how NPL currently looks for some of crypto's biggest names:

Bitcoin

Bitcoin hit its lowest NPL of the month yesterday, and is well below its 30d and 200d trendlines. A great sign that an imminent local top isn't approaching.

Ethereum

ETH is more neutral than BTC, sitting right between its 30d and 200d trendlines.

Chainlink

Chainlink is at a low for the month in NPL, and this coincides with a major address activity spike. Could be good here.

Litecoin

LTC's NPL is below the 30d and 200d trendlines and has been sitting encouragingly low for about 2 straight weeks now.