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.