When news of a new upgrade coming Litecoin’s way last month broke out, there was lots of excitement within its community, and this was reflected in the price of the coin. LTC managed to rally by more than 53% in two weeks and even went higher a few days later, managing to peak at $67. However, since then, some consolidation has taken place, and the coin currently trades at $50.

But investors believe there is another rally coming, and this one will even be better than the previous one thanks to an upcoming key upgrade and signs of increased activity within the network. The upgrade will see Litecoin add on privacy to its transactions by integrating Mimblewimble, a protocol that shields the identities of senders and recipients of LTC tokens within the network. The upgrade is also likely to improve the network’s ability to scale and handle more transactions in the process.

Litecoin has been testing mimblewimble for over a year

It turns out Litecoin has been testing the privacy protocol for over a year now, and the integration is expected to take place by the end of September. And based on market data, this looming upgrade has users excited. Litecoin trading on platforms like PrimeXBT has peaked over the past few weeks, and this is expected to continue once the upgrade is implemented.

According to Glassnode, the daily confirmed transactions on the network’s blockchain have more than doubled since the start of the year, managing to peak with a seven-day average of 48,948 over the first week of August. You have to go back to February 2018 to see the last time such numbers were registered.

The new upgrade will add Litecoin to the list of existing privacy coins, and proponents of the token hope it will attract new users from the likes of Monero and Zcash, thereby adding to its existing fan base.

According to Matthew Dibb, the co-founder of Stack, the upcoming Mimblewimble upgrade has sharply increased the number of transactions on the network and active addresses.

The upgrade will see Litecoin handle more transactions

Litecoin will also be able to handle more transactions solving scalability issues that might have deterred some investors and users in the past, according to Nicholas Pelecanos, the head of trading at NEM Ventures.

Even though Litecoin’s network processing speed has doubled this year, at one transaction every second, it’s still far below that of Bitcoin, which can handle at least 3.7 transactions within the same period. But, thanks to the upcoming upgrade, this is likely to change soon.

The only issue with the privacy features being added is how regulators are likely to react. Over the past few years, we have seen Coinbase UK delist Zcash and Upbit delist XMR, DASH, and ZEC after pressure from authorities.

Speaking to CoinDesk, Charlie Lee, the mind behind Litecoin, said that there was some sort of stigma against privacy coins, and this has seen some exchanges delist them. Adding that with Litecoin, its somehow different, and exchanges seem to be ok with it since the upgrade will act as an extension block that will be on the side, and the trading platforms will have the option of not supporting the extension.

According to David Schwartz, who is the project director at Litecoin Foundation, the current Litecoin price doesn’t reflect its actual value since the average usage has more than doubled since the last bull run, and it’s still “gaining steam.” Also, transactions have outpaced the historical price.

What next?

Some, though, are skeptical with Connor Adendschein, who leads research at Digital Assets Data, claiming that LTC is only performing better since there is an upgrade around the corner. He also attributes the coin’s good fortune to the overall bullish sentiment that has engulfed the entire crypto market over the past few months. He believes that as the upgrade nears, we are likely to see whether Litecoin is just riding on the positive market sentiment or if it’s likely to find its own legs and run its course.

That said, things don’t look that bad for LTC at the moment, and it makes sense why traders are rushing on platforms like PrimeXBT to acquire the coin. Now we have to wait until the end of the month and see what happens once the upgrade is effected.