It appears the LINK price momentum has quieted down a bit in recent weeks. Although a 10.4% increase in value for the past months is still acceptable, many may see it as Chainlink peaking. With both exchange deposits and withdrawals hitting new lows, the coming days may prove crucial for this asset.
LINK Exchange Deposits Keep Drying Up
Any cryptocurrency asset needs to be as liquid as possible. More specifically, there has to be sufficient trading volume to keep the price action going in either direction. For Chainlink’s LINK, that liquidity is slowly decreasing, creating a more prominent aspect of scarcity. As the exchange deposits have hit a four-month low, fewer people are depositing LINK into their account lately. A somewhat surprising development, but an interesting one.
It is not the first time a cryptocurrency asset has fewer exchange deposits. Slowly but surely, this is becoming the norm across all major assets. However, the statistics only apply to centralized exchanges and do not include DEXes. Some of the circulating LINK supply may be making its way to Uniswap and other platforms. High Ethereum gas fees won’t deter all users from trading on those platforms.
What is equally surprising, however, is how fewer LINK are being withdrawn from exchanges. Recording an eight-month low at this time seems rather unusual. Despite this low point, more LINK is withdrawn from centralized exchanges compared to the overall deposits.
As such, there will be fewer LINK to buy on these platforms. The difference between exchange and deposit amounts is not that big, though.
LINK ATH Remains Possible
The big question is what this all means for the Chainlink price. Most metrics do not contribute much to the overall price momentum, as crypto-assets don’t always follow market logic. For most alternative currencies, it always comes down to how Bitcoin performs. Today seems to be a positive day, but a lot can happen when people least expect it.
Speaking of the Chainlink price momentum, it appears that reaching a new all-time high is still possible. Although LINK is down nearly 25% from the high recorded on February 20 – $36.95 – the deficit isn’t that steep. Additionally, Chainlink has proven to be a resilient market, as more partnerships and integrations occur every week. The blockchain oracles provided by Chainlink remain in high demand.
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