Litecoin completed its halving, but its price plummeted 6%.

Litecoin completed its much-anticipated halving event today, but it appears investors have responded by engaging in selling.

Litecoin has completed its third halving and the block reward has now been reduced to 6.25 LTC.

A “halving” event is one in which LTC’s block reward is permanently halved. This event occurs periodically, approximately every four years, or approximately every 840,000 block miner hashes.

Today’s halving was Litecoin’s third halving, meaning Litecoin’s block reward has been cut three times since its inception. In the first halving, the cryptocurrency’s block reward was reduced from an initial 50 LTC to 25 LTC, and in the second halving, the tip dropped further to 12.5 LTC.

Due to the recent halving event, the miner’s reward for solving a block was further reduced to 6.25 LTC. The reason halvings exist is because they serve as a measure to control the inflation of assets.

These block rewards that miners receive are the only way to introduce new tokens into the circulating supply, so repeatedly reducing tokens causes the cryptocurrency supply to grow more and more slowly.

Eventually, as halvings continue to occur, the block reward will approach 0. This takes place approximately in 2142. After this point, the asset supply will reach its maximum limit and miners will have to rely on transaction fees to pay for operating costs.

Halving is a significant event, so it is natural that there has been a lot of discussion about it as it approaches. In early July, the asset saw a sharp rise towards the $114 level. That’s because the market has gotten its hopes up about the halving, which is probably only a month away.

However, this rally soon lost steam and since then LTC has struggled to gather significant bullish momentum.

LTC has plunged during the past day | Source: LTCUSD on TradingView

Today’s halving didn’t change anything in this matter either. Because Litecoin instead just plummeted further. This event really appears to be a buy on the rumor, sell on the news type of scenario.

After the recent plunge, Litecoin fell below the $87 level and is down nearly 7% in the last 24 hours. These high losses mean that LTC is the worst performing coin among the top cryptocurrencies by market capitalization during this period.

While the asset’s price performance may have been poor, LTC supporters can take solace in the fact that the asset has fared much better in terms of other network-related metrics since the previous halving. Into the Block show:

The growth of the LTC network | Source: IntoTheBlock on X

Interestingly, the prices at which both halvings occurred were approximately the same. Cryptocurrencies appear to be performing well in terms of user base and utility-related growth.

This impressive increase in adoption may be because Litecoin offers cheaper and faster transactions compared to other networks such as Bitcoin. But LTC investors can only hope that this growth translates into price as well.

Featured image by Kanchanara on Unsplash.com, chart by TradingView.com, IntoTheBlock.com