Chainlink Price Falls as ETF Inflows Slow and TVS Drops to $30B

Key Insights

• Chainlink price has crashed sharply in the past few months.
• Spot LINK ETF inflows have continued slowing in the past two weeks.
• The token has formed a head-and-shoulders pattern, pointing to more downside.

Chainlink price retreated sharply, reaching a low of $6.98, its lowest level since September 2023. LINK token has retreated by over 73% from its highest level in December 2024, a move that has erased billions of dollars in value. This retreat may continue in the near term as ETF inflows slow and its Total Value Secured (TVS) collapses.

Chainlink, a top player in the blockchain oracle industry, is facing major challenges as the crypto winter gains steam. Data shows that the Total Value Secured has been in a strong downward trend in the past few months.

The TVS has dropped to over $30 billion, its lowest level since April last year, and much lower than last year’s high of nearly $72 billion. This retreat has dropped as the total value locked (TVL) in its top ecosystem applications has dropped sharply this year.

The most important one of them is Aave, whose TVL plunged to $12.3 billion from last year’s high of $45 billion. Aave’s TVL accelerated its downtrend after the recent KelpDAO hack that pushed it on the verge of collapsing.

Other top players in the ecosystem have continued seeing a substantial decline in its assets in the past few months. This includes top players like Maple, Sentora, Steakhouse Financial, Spark, and Compound.

The ongoing TVS crash has led to a significant decline in the network fees that Chainlink collects. Data shows that Chainlink made $14.5 million this quarter, down from $16 million in Q1 and $15.7 million in the fourth quarter of last year.

These numbers mean that the network is not seeing substantial growth this year. This is understandable as the broader industry is going through a crypto winter, where Bitcoin and top altcoins are struggling.

The other key risk facing Chainlink price is that demand for LINK ETFs has continued to wane this year. Data shows that spot LINK ETFs have added over $3.96 million this month.

While the amount is higher than that of Ethereum and Bitcoin, it is also the lowest since their launch. These funds added $8.29 million in May this year, down from $12.95 million in April. In total, these ETFs have had a cumulative net inflow of $123 million since their creation, with Grayscale’s GLINK having $79 million.

The same trend is happening in terms of staking volume. Data shows that the total staked LINK assets have been falling, a sign that some stakers are capitulating.

The staked LINK tokens dropped to $338 million, down sharply from last year’s high of $1.08 billion.

Chainlink’s demand has continued to wane in the spot and futures market. Its open interest has dropped to $411 million from last year’s high of $1.91 billion. That is another sign that its demand has continued to wane.

The weekly chart shows that the LINK price has crashed in the past few months. It has slumped from a high of $30.8 in December 2024 to the current $7.93.

A closer look shows that it has formed a multi-year head-and-shoulders pattern, a common bearish reversal sign in technical analysis. It has moved below the key support of $10.17, the neckline of this pattern. Most notably, it has retested this price, confirming the bearish breakout.

The coin has also slumped below all Exponential Moving Averages (EMA), while the Relative Strength Index (RSI) has continued falling. Therefore, the most likely LINK price forecast is bearish, with the next level to watch being at $4.90, its lowest level in 2022.

The post Chainlink Price Prediction: LINK at Risk as ETF Inflows Slow and TVS Crashes appeared first on The Market Periodical.