Four Reasons Why Investors Are Bullish On Chainlink
November 06 2023 - 4:00PM
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Chainlink’s recent price surge of 63% has turned heads in the
cryptocurrency community. This uptrend begs the question: what’s
driving investor confidence in Chainlink? Let’s dive into four key
reasons that might be contributing to this bullish trend. #1
Chainlink Dominance In The Oracle Space Oracles act as a bridge
between blockchain networks and the external world, fetching data
that decentralized applications (dApps) rely on to function. This
data can vary widely, from cryptocurrency price feeds essential for
decentralized financial (DeFi) platforms to weather information or
the results of real-world events for betting platforms. Related
Reading: November Outlook For Bitcoin Price: Another Pump Or
Retrace? Chainlink has emerged as the leader in this pivotal
market, capturing a 47% share with its extensive network of over
1,000 oracles and support for 14+ blockchain platforms. By
positioning itself as the primary provider of external data
integration, Chainlink has become an essential component of the
blockchain infrastructure. #2 Other Products By Chainlink Expanding
beyond its initial focus on data feeds, Chainlink now offers a
broad spectrum of blockchain services that have significantly
strengthened its market presence: Verifiable Random Function (VRF)
– a verifiable method of producing complete randomness at a low
cost, particularly useful to create random outcomes within gaming
and gambling applications, as well as for any application requiring
unpredictability in its protocol. Automation – allows smart
contract developers to utilize Chainlink’s infrastructure to
automate their smart contracts cost-effectively and securely, which
is crucial for the scalability and efficiency of decentralized
applications (dApps). Cross-Chain Interoperability Protocol (CCIP)
– enabling seamless interaction and transfer of data and value
across blockchain networks. This interconnectivity is pivotal for a
more integrated and accessible blockchain ecosystem. The
introduction of CCIP, especially, underscores Chainlink’s
commitment to driving the industry forward. It simplifies the user
experience and broadens the potential use cases for blockchain
technology, aspects that are highly attractive to institutional
investors looking to enter the space. #3 Institutional Interest
Chainlink’s CCIP and other products have allowed it to collaborate
with big institutions, such as: SWIFT – a global financial network
that 11,000+ financial institutions use to securely transmit
information and value, up to trillions of dollars. DTCC – a global
financial entity that processes and settles security transactions
totaling quadrillions of dollars. ANZ – one of the big four banks
in the Asia-Pacific region, handling billions of dollars annually.
Other notable institutions working with Chainlink are BNP Paribas,
Citi, and PwC Germany. These partnerships highlight that
institutions see the potential opportunity for blockchains and
real-world systems to interact effectively. Chainlink’s co-founder
Sergey Nazarov says: It’s now clear that both top global banks and
leading market infrastructures believe there will be greater
adoption of digital assets across the entire banking industry, and
that this adoption will happen using multiple different blockchain
technologies at the same time. #4 Bullish Price Action Chainlink
had traded between $5 and $9 between June 2022 and September 2023.
In October, its price finally managed to break out of this range
after an increase of 63%, reaching $12. This price increase was one
of the largest within the cryptocurrency market, highlighting the
faith investors have in this token. Related Reading: Bitcoin
Season: Leading The Charge In The Crypto Market The price currently
sits in a previous trading range between $11 and $17. For the price
to reach the top of this range, it would have to climb another 50%.
Chainlink's Price Action on the monthly chart. Source: LINKUSD from
TradingView With its previous all-time highs of $53, it suggests
there is still much room for Chainlink’s price to grow.
Specifically, a 340% increase would have to occur for it to reach
its previous highs. Investment Disclaimer: The content provided in
this article is for informational and educational purposes only. It
should not be considered investment advice. Please consult a
financial advisor before making any investment decisions. Trading
and investing involve substantial financial risk. Past performance
is not indicative of future results. No content on this site is a
recommendation or solicitation to buy or sell securities or
cryptocurrencies. Featured image from Shutterstock, Charts from
TradingView.com Predycto is the author of a cryptocurrency
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