Introduction
Brace yourself as new LINK tokens perpetually flood the market. Chainlink, as part of its periodical unlocks, recently unlocked 21 million LINK tokens, valued at $295 million. This significant move involved five of its non-circulating supply contracts. As noted by Spot on Chain, the majority of these tokens were sent to crypto exchange Binance, prompting speculation about a potential dip in the price of Chainlink.
Impact on Chainlink’s Market
These speculations have been further escalated, considering that Chainlink hasn’t been left behind in the wider market decline. Currently, Chainlink is on an 8% decline in the past seven days. The recent influx of tokens into the market could potentially exacerbate this downward trend, as increased supply often leads to decreased prices, at least in the short term.
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Chainlink’s Token Unlock Schedule
Like many crypto tokens, Chainlink has a token unlock schedule that ensures an annual LINK release rate of approximately 7% of the total circulating supply. This recent unlock saw the number of LINK tokens in circulation cross above 600 million for the first time. Immediately after the unlock, 18.25 million LINK tokens worth $265 million were immediately sent to Binance.
Future Prospects
While the immediate outlook may appear bearish due to the increased supply and recent market declines, it’s essential to consider Chainlink’s long-term potential. The utility and adoption of Chainlink’s decentralized oracle services continue to grow, which could provide strong support for LINK’s price in the future. Investors and market watchers will need to keep a close eye on how these newly unlocked tokens are utilized and their impact on the market.
