Chainlink announces a $1 million LINK reserve fund, funded by enterprise revenue and onchain services.
Chainlink has launched a strategic reserve fund to support the long-term growth and sustainability of the decentralized oracle network by accumulating tokens from both offchain revenue from businesses and onchain revenue from services. This initiative has purchased over $1 million worth of LINK tokens during its launch phase and is expected to gradually increase as more revenue is converted in the coming months.
The price of LINK reacted positively to the announcement, rising about 9.4% to $17.96 on the day according to data from The Block. This move reflects market confidence in the sustainable business model that Chainlink is building.
Chainlink plays a crucial bridging role between blockchains and real-world data, other decentralized networks, and enterprise systems. The platform handles transaction volumes worth tens of trillions of USD across various sectors including DeFi, banking, Real-World Assets, and cross-chain applications.
The model for converting revenue into LINK
Adopted by major organizations such as Swift, Euroclear, Mastercard, UBS, and Aave, Chainlink has generated hundreds of millions of USD in revenue, primarily from offchain payment businesses to access the platform. This resource will continue to drive the reserve fund in the future.
The reserve fund uses payment abstractions to convert onchain and offchain revenue into LINK. Users can pay for Chainlink services in their preferred format such as stablecoins, which are then swapped for LINK through decentralized exchanges programmatically.
Co-founder Sergey Nazarov emphasized the importance of the initiative: “The launch of the Chainlink Reserve marks a significant development for Chainlink, establishing a strategic LINK reserve funded by offchain revenue as well as from the usage of onchain services.” He stated that this fund provides a clear answer on how offchain revenues and the adoption of the Chainlink standard at an organizational scale will be connected back to growth, security, and sustainability.
Chainlink is committed to not withdrawing tokens from the reserve fund for the next few years, allowing the fund to grow steadily over time. This long-term strategy demonstrates confidence in the sustainable growth capability of the oracle network.
As demand for Chainlink services continues to rise, the project anticipates that higher levels of adoption will further strengthen the reserve fund. This model creates a positive feedback loop, where the growth of the Chainlink ecosystem directly contributes to the enhancement of LINK reserves.
