Mysterious Whale is rapidly accumulating Chainlink (LINK). According to Lookonchain, an unknown entity, possibly an institution, withdrew more than 2.2 million LINK (worth $42.38 million) through 47 new wallets from Binance, the world's largest cryptocurrency exchange by trading volume, in two days.
This sudden block withdrawal now raises questions about what is driving the whale's interest and what it could mean for LINK in the coming days.
cryptocurrency whale accumulating LINK |Source: Lookonchain via X
Chainlink plays a key role in DeFi and NFTs, gradually improving
Chainlink is a popular project that provides secure middleware services and allows smart contracts to access tamper-proof external data. For this role, the platform has been adopted by several protocols offering decentralized finance (DEFI) services on Ethereum and beyond.
Additionally, Chainlink plays a role in non-fungible tokens (NFTs) through its Random Number Generator (RNG). The company continues to release new products and expand its capabilities.
For example, in November, Chainlink updated its staking engine by releasing version 0.2, which significantly increased the pool size to 45 million LINK.
The platform noted that the solution was to attract more investors and, more importantly, strengthen its security, while aligning with the broader goal of achieving the Economy 2.0 plan.
Staking initially commenced in December 2022. The goal was to encourage participation by expanding LINK's capabilities and allowing stakers to earn rewards.
The release of version 0.2 in November means more tokens can be locked up, which will help make LINK scarce given the token's role in the vast Chainlink ecosystem.
Trackers show that more than 40.8 million LINKs have been blocked so far. Chainlink confirms that anyone can earn a variable reward rate of 4.32%.
LINK is at stake |Source: Chainlink
In addition to staking, the Chainlink Interconnect Protocol (CCIP) is becoming increasingly popular. For example, the Hong Kong Monetary Authority (HKMA) began the first phase of testing an electronic Hong Kong dollar (e-HKD) in November by integrating CCIP.
As part of this trial, the regulator wanted to demonstrate the programmable payments capabilities implemented by Chainlink using its CCIP solution. In DeFi, protocols like Synthetix and Aave use CCIP.
Will LINK break $20?
With more protocols and legacy institutions using this technology, demand for LINK (and prices) will likely increase as fear of missing out (FOMO) sets in.
While the whales' motives remain unknown, their large-scale accumulation of LINK suggests they may be bullish on the token. Notably, this coincides with LINK's price surge over the past 48 hours.
Chainlink price is rising on the daily chart: Source: LINKUSDT on Binance, TradingView.
At the moment, the token is changing hands just below the psychological resistance of $20. Any breakout above this level could push the token price to around $35 in Q3 2021.