Chainlink price recovers with rising development activity in LINK
- Chainlink network’s development activity has steadily increased over the past three years.
- The rising activity from the blockchain’s developers has pushed it to a top-four spot alongside Polkadot, Kusama and Cardano.
- Chainlink price started its recovery this week, LINK climbed nearly 4% from Monday’s intraday low to $6 at the time of writing.
Chainlink network’s development has pushed the altcoin into the ranks of the top four assets by the highest activity, according to crypto intelligence tracker Santiment. Chainlink ranks alongside Polkadot, Kusama and Cardano, while the development activity metric has likely catalyzed a recovery in LINK price.
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Chainlink development activity likely catalyzes recovery in LINK
On-chain intelligence tracker Santiment has shared insights from three years of development activity in the top 10 cryptocurrency projects. The chart compares the development on the following protocols:
Polkadot (DOT), Kusama (KSM), Cardano (ADA), Chainlink (LINK), Hedera (HBAR), Vega Protocol (VEGA), Status (SNT), Cosmos (ATOM), Internet Computer Protocol (ICP) and Filecoin (FIL).
Development activity in top 10 protocols mapped by Santiment
In the case of Chainlink, updates to the blockchain network are likely acting as a catalyst for LINK price. LINK price has been in a downward trend that started on July 20. Among other catalysts, consistent development on the chain has pushed Chainlink toward a recovery.
Other on-chain metrics, like supply on exchanges, track the volume of LINK tokens on centralized exchange platforms. This helps determine the selling pressure on the asset. Supporting the thesis of LINK price recovery, the supply is relatively stable, with no increase in selling pressure on the altcoin.
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Chainlink supply on exchanges vs price
LINK price climbed nearly 4% on Wednesday from Monday’s intraday low of $5.74 to $6.00 on Binance at the time of writing.
Bitcoin, altcoins, stablecoins FAQs
What is Bitcoin?
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
What are altcoins?
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
What are stablecoins?
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
What is Bitcoin Dominance?
Bitcoin dominance is the ratio of Bitcoin's market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.
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Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
