Litecoin has seen a resurgence this month, jumping 18% since May 8 as traders look for alternative assets to Bitcoin, which has seen an increase in both fees and transactions.
The 12-year-old cryptocurrency, a dinosaur compared to many others in the space, has benefitted as Bitcoin’s fees reached a multi-year high of $30 on May 8, according to BitInfoCharts. Since May 8, Bitcoin and Ether have both fallen about 1.7%. As of midday Thursday, Litecoin was trading for about $91.60, still a 13% gain over seven days.
Bitcoin fees have since declined, but some traders have complained that the newly popular Ordinals—Bitcoin NFTs—are clogging up the network and have pushed fees higher. Meanwhile, others have insisted Ordinals and BRC-20 tokens are the key to expanding the utility of the Bitcoin network.
Over the past week, Bitcoin saw outflows of about $38 million from eight publicly traded investment products, from asset managers like Grayscale Investments and 3iQ, representing $32.4 billion in assets under management, according to a report from CoinShares. Over the past seven days, reallocations away from Bitcoin made up 80% of the total $53 million in outflows across the cryptocurrencies that the asset managers invest in. While the investors moved away from Bitcoin, the second-biggest cryptocurrency, Ether, saw inflows of $100,000 over the week, according to CoinShares.
The move away from Bitcoin by some traders coincides with a spike in activity for memecoins. Fueled by hype and speculation, the cartoon-frog-themed Pepe coin reached a market cap of more than $1 billion before falling back to earth. Earlier this month, a coin created by a digital artist mostly with instructions from A.I. chatbot GPT-4 reached a market cap of more than $70 million, and broke into the top 300 tokens on CoinGecko, before retreating.
Over the past week, the shift to altcoins has continued, with Cardano and Tron experiencing inflows of $500,000 and $230,000, respectively, according to CoinShares.
Bitcoin, up a little less than 1% on Thursday, mostly has been flat over the past seven days, as has Ether, according to CoinMarketCap.