Chainlink (LINK) has joined the top 5 most valuable cryptocurrencies by market capitalization, following a surge in interest by crypto traders and investors for the digital coin over the last few weeks.
Link, which is currently worth about $19, has gained about 418% since July 1, 2020, when it was trading around $4.55. Chainlink (link) is pushing closer to the $20 threshold and solidifying itself in the number five position for the most valuable cryptocurrencies ranked by market capitalization.
Sometimes when the price of crypto-assets increase overtime, it gets to a point when the bubble will burst and almost all assets will experience price correction. The less mature the crypto asset and the weaker the fundamentals, the sharper the correction will be.
Is Chainlink overvalued?
Nairametrics does not believe that Chain link is overvalued. Compared to 2017, DeFi tokens are nowhere close to being as overvalued as mainstream crypto assets like BTC and ETH. However, there is a strong level of caution among investors.
Quick fact: Defi means “decentralized finance”. It is a crypto ecosystem made up of financial apps designed on leading blockchain platforms.
These digital assets are designed on Ethereum codes, and usually exhibit characteristics that include having protocols and financial smart contracts.
Chainlink is a blockchain that is designed to bridge the space between blockchain technology-based smart contracts (created by ETH), and other user programs.
Since blockchains by principle can’t have access to data outside their paths or networks, a DeFi instrument is needed to facilitate data feeds in smart contracts, and Chainlink helps to solve such needs.
Download Nairametrics App for breaking news and market intelligence.