Chainlink (LINK), a decentralized oracle network, has seen a noticeable price surge, primarily driven by a significant gathering of whales.
Over the past six weeks, whale investors have added more than 8.5 million LINK tokens to their holdings, causing prices to rise again. bullish sentiment inside the market.
This surge coincides with an increase in activity on the network, making Chainlink a focal point for investors looking for long-term growth.
Chainlink, which ranks 14th by market capitalization, has risen 8.8% over Bitcoin in recent days.
Whale Accumulation Signals Bullish Outlook
Chainlink’s recent price movement can be attributed to whale accumulation. On-chain data shows that large investors holding more than 1 million LINK have significantly increased their holdings over the past six weeks.
The collective assets of these wallets increased from 685.5 million. CONNECTION in mid-August to 694.0 million by the end of September – a total increase of 8.5 million LINK.
🔗📊 Chainlink’s recent price breakout came courtesy of whales amassing over 8.5 million LINK in the last 6 weeks. Our featured article highlights the enthusiastic community, surge in online activity and more for the 14th ranked cryptocurrency! 👇 https://t.co/SEE0gMKSHY pic.twitter.com/E26cc9qUSd
— Santiment (@santimentfeed) September 25, 2024
China’s $1 million-plus transactions surged in September, according to Santiment. Such moves by institutional investors and high-net-worth individuals often precede large price changes. For now, the trajectory suggests continued bullish momentum, although caution may be warranted.
Network activity and dormant tokens indicate confidence
The significant increase in activity on the network also contributed to the increase in Chainlink prices. On September 19, Chainlink recorded its third-largest daily token circulation surge of the year.
This surge often signals renewed interest from both retail and institutional investors. However, the “average dollar age of investment,” which tracks how long LINK tokens were held, there was a sharp decline in mid-September, suggesting that long-term holders were moving their tokens again.
Brian K., a cryptanalyst, noted in his report that “the reactivation of dormant tokens is typically a bullish signal as it reflects renewed confidence among long-term holders.” This activity indicates that many investors who previously held their LINK in wallets are now interacting with the market again, further fueling the price rally.
Additionally, Chainlink’s (NRPL) network realized profit/loss has moved into profitable territory, showing that many investors are now in the money, easing selling pressure.
Community Sentiment and Development Activities Promote Chainlink
The Chainlink community remains one of its strongest assets, with active supporters on social media platforms such as X (formerly Twitter) And Reddit. These communities often amplify positive changes, further stimulating investor interest.
As seen in previous market cycles, strong crowd sentiment can have a direct impact on market performance. Brian K.’s research shows that increased social media activity regarding Chainlink often coincides with buying pressure, causing short-term price increases.
Beyond social sentiment, Chainlink maintains a robust development ecosystem. According to data According to Santiment, the project has logged 624 notable GitHub events in the last 30 days, ahead of Ethereum and other major ERC-20 tokens.
Santiment previously noted that significant developer activity suggests trust in the protocol, which can lead to its long-term value for token holders.
Whale movements may signal volatility
While Chainlink’s price rise has been supported by whale accumulation and positive on-chain performance, there are also reasons to be cautious. Historical data shows that significant whale movements can sometimes precede market volatility.
The recent transfer of 18 million LINK tokens to Binance suggests that some large holders may be preparing to take profits. Santiment’s research shows that each accumulation phase caused by whales is often followed by a period of consolidation or correction.
While LINK’s long-term outlook remains positive as its decentralized Oracle technology continues to power real-world applications, investors should be mindful of potential short-term fluctuations.
The current market value to realized value (MVRV) ratio indicates that while LINK still has upside potential, prices approaching +15% MVRV could signal an overbought market.