on the crypto
Chainlink's Link token jumped to record highs on Monday, far exceeding bitcoin yields since the beginning of 2020. According to analysts, the ever-increasing use of Chainlink's price oracles in decentralized finance (DeFi) is growing cryptocurrency.
The twelfth largest cryptocurrency by market value is trading at $ 5,12 at press time, going over 200% of earnings on an annual basis. At the same time, bitcoin here the quotation in real time - it only gained 29% this year, according to Coin Metrics data. The cryptocurrency Link therefore decoupled from bitcoin, the leader in the crypto market.
Chainlink increasingly present in the DeFi
Observers are associating the Link boom with the increased use of Chainlink in the decentralized financial space. Chainlink is an oracle system built on the Ethereum blockchain.
The advantage that Chainlink offers is that of providing data to smart contracts in a decentralized way or from multiple sources. This ensures the security and reliability of the blockchain, which could be compromised in the event that the oracle depends on a single source, as seen from some precedents. For this reason, the DeFi industry has turned to Chainlink.
A forward-looking vision
“We expect that the value of Chainlink will continue to be appreciated in the long term. We believe that the smart contract platform that will eventually become the standard for Web3 will be assessed on several much higher factors than Ethereum's current market capitalization. In this case, it is natural to assume that its security level, Chainlink, will also increase significantly in value, "said Vance Spencer, co-founder of Framework Ventures, one of the major private holders of Link tokens.
Chainlink is an oracle system built on the Ethereum blockchain. Some observers are of the opinion that Chainlink is best placed to benefit from the current shift in focus from base-level chains to middleware services that provide security for data feeds. Additionally, the ability to earn further with Link tokens could drive demand for cryptocurrency.
Will there be a short-term correction?
With the token flow to the exchanges, there is a possibility that the cryptocurrency could witness a short-term pullback. The net trade flow, or the difference between the volume flowing in and out of the exchanges, rose to 3.482, the maximum since March 14, according to data provided by the blockchain analysis company Glassnode.
Investors tend to move the cryptocurrency from their portfolios to exchanges to be able to liquidate holdings more quickly during a price slump or when they expect a price drop.
"From a technical point of view, Link has just passed his biggest resistance level at $ 4,90 and is now in price detection mode in both BTC and USD terms," said Connor Abendeschien, analyst at crypto search at Digital Assets Data.
