Rising Adoption and DeFi Utility Will Fuel Chainlink

By July 20, 2021DeFi
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In 2020, Chainlink (CCC:LINK-USD) rose through the ranks and was among the top five digital assets in the world. An incredible bullish rally during the summer allowed the altcoin to climb as high as $20.

a digital representation of the chainlink (LINK) cryptocurrency
Source: Stanslavs / Shutterstock.com

This year, its price rose to an all-time high of $53. However, at this point, it has dropped more than 66% of its value from its all-time highs. The crypto market as a whole has been under duress, which has reflected on the altcoin’s performance.

However, the LINK token has real-world utility, particularly in the DeFi realm, strengthening its long-term case.

The crypto industry had come of age in 2020 and had a solid start this year. For instance, industry leader Bitcoin (CCC:BTC-USD) hit an all-time high of $65,000 in April but closed out the first half down more than 40% from that level. Moreover, multiple risks are likely to hurt the industry going forward.

Regardless of the flash crashes and corrections, the cryptos that continue to innovate and offer their users long-term value will weather any storm. Chainlink is an altcoin with massive potential to break through its resistance levels and solidify itself as a top cryptocurrency.

Laying The Groundwork For DeFi

Chainlink Co-founder Sergey Nazarov shared his vision for Chainlink 2.0 in last month’s Global DeFi Summit. In his own words, “I think it’s pretty much clear to the people in our industry that DeFi is a force that’s going to continue.”

This is primarily because it gives users the incentive to earn interest on digital assets. Moreover, Nazarov foresees a future where banks need to interact with multiple blockchains by integrating with middleware such as Chainlink.

Furthermore, Nazarov believes the culmination of DeFi involves a massive bank of hybrid smart contracts, where each contract relates to a unique DeFi capability. This is because Nazarov believes that DeFi is “the first large-scale widely adopted hybrid smart contract.”

The foundations of the DeFi system are enabled by Chainlink’s decentralized oracle networks (DONs). He further goes on to say that “Chainlink is the largest and most widely used decentralized oracle network and set of decentralized oracle networks enabling the majority of DeFi to operate and function correctly.”

Positive Recent Developments

There have been several positive developments for Chainlink of late, which points to an increase in its adoption. First, investment broker BarnBridge recently announced its partnership with Chainlink. The company said that it would be using Chainlink Keepers, to gain a stable exposure ratio for asset pairing.

Moreover, last month, Chainlink registered for the Smart Contract Developer Bootcamp to offer training to develop Ethereum-based (CCC:ETH-USD) smart contracts. Additionally, Weathsimple, a Canadian investment management service, announced its support for the LINK token in its native platform for trading.

Furthermore, Grayscale Investments, the largest cryptocurrency asset manager, announced that it was launching five new investment trusts in March. One of the trusts is for the Chainlink crypto. Additionally, one of the world’s largest cryptocurrency exchanges, eToro, announced adding Chainlink to its exchange.

Final Word On LINK

The LINK token has lost a fair bit of its value in line with the rest of the industry. However, its utility in the DeFi sector gives it a unique edge over its peers and the resiliency to weather multiple crises in the crypto industry.

Recent positive developments indicate that its adoption and acceptance are growing among investors and trading exchanges. Therefore, Chainlink has a bright future and an impressive growth runway ahead.

On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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