What happened
The value of the low-cost blockchain token Litecoin (CRYPTO:LTC) jumped 6.8% in trading on Monday after introducing a new token standard. At 3 p.m. ET, the token was hitting its daily highs.
So what
Litecoin introduced the experimental LTC-20 token standard, which can be used for non-fungible tokens, or NFTs, and may make the blockchain more usable for developers. The number of transactions and active wallets spiked as much as 500% after the experimental standard was announced.
One of the best use cases for blockchain technology so far has been the introduction of NFTs, which allows the issuer to gate access to websites or prove ownership of an item like a piece of art. If Litecoin can capture some of the NFT markets, it could add value to the ecosystem overall.
Now what
Clearly, there was a jump in activity when LTC-20 was introduced, but there's a long road to real value being created. It's taken years for the leading NFT blockchains to establish themselves, and even those blockchains are struggling to attract new users.
While I would see this as a positive for Litecoin overall, I'm not sure if it's a need in the market that will gain much traction. High-value blockchains like Ethereum have a big presence in NFTs, and low-cost, high-volume blockchain Solana has a big NFT market. But both are struggling to add value, and I don't know that another blockchain is the answer. So the pop is understandable, but may not last long.
