Chainlink (LINK) has seen a price jump of almost 12% in the past week. Interestingly, data shows a significant trend: investors are moving their LINK tokens off of cryptocurrency exchanges.
The Great LINK Exodus
A crypto analytics firm, Sentora, highlighted a key metric: “Exchange Netflow.” This simply measures the difference between LINK entering and leaving exchange wallets. A positive netflow means more LINK is going onto exchanges (often a sign of potential selling pressure). A negative netflow, on the other hand, means more LINK is leaving exchanges – potentially a bullish signal, as it suggests long-term holding.
For the past ten days, Chainlink’s Exchange Netflow has been strongly negative. That’s a lot of LINK leaving exchanges! Sentora estimates that around 3.86 million LINK tokens (about $51.26 million) have been withdrawn since June 20th.
Correlation, Not Causation?
While the price surge and the exchange outflows happened at the same time, it’s not a guaranteed cause-and-effect relationship. The price increase was quite rapid initially, but the rally has since slowed down, even though the outflows continue.
Still, the fact that investors are actively moving their LINK to self-custody wallets is generally seen as a positive sign. It suggests confidence and a long-term outlook for the cryptocurrency.
Bitcoin’s Similar Story
It’s not just Chainlink; Bitcoin has also experienced significant exchange outflows recently, according to data from Santiment. While there was a sharp drop in Bitcoin on exchanges earlier this year, the trend has leveled off recently.
Current LINK Price
At the time of writing, Chainlink is trading around $13.22, slightly down for the day.