Chainlink has identified the release of 21 million tokens not previously in circulation. The value of these tokens at the time of release was approximately $295 million. Chainlink’s circulating supply is limited to 1 billion tokens, so new releases may negatively impact prices. Historical data shows that increased supply from token unlocks tends to lower prices. Following the recent unlock, data from Spot On Chain indicates that 18.25 million tokens were sent to Binance.
Current State of Chainlink
The transfer of cryptocurrencies to exchanges is generally seen as preparation for a sale. Additionally, 2.25 million LINK worth $31.30 million were sent to a multi-sig wallet.
The transfer to the wallet suggests that the Chainlink tokens may not be sold soon. At the time of writing, LINK was trading at $13.61, reflecting a 1.37% drop in the last 24 hours. This drop could be interpreted as a result of the aforementioned transfer. The current question in the market is whether LINK’s price will fall.
Will LINK Price Drop?
Network speed indicates how quickly transactions are processed. A low metric shows tokens are being held rather than circulated.
Generally, removing cryptocurrencies from circulation can increase prices due to reduced supply. However, data from Glassnode shows that LINK’s speed has been rising since June 20.
If this trend continues, LINK’s price may also rise. Conversely, a drop below $13 could occur. The IOMAP indicator, which shows price inflows/outflows, also reflects potential declines.
Chainlink investors may reach resistance and support levels based on this indicator. Data from IntoTheBlock shows that 12,090 addresses purchased 5.84 million LINK at an average price of $13.40. Understanding that this group is in profit is crucial.
However, another group of 14,140 addresses bought 11.62 million tokens at $13.90, indicating losses. In summary, LINK may not rise to $14 due to the high concentration of addresses.
This is because some investors currently at a loss may cause a breakdown even if LINK reaches $13.90. Therefore, the price could drop to $12.95.
