Chainlink Soars 22%, Outperforming the Market - What’s Behind It?

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Chainlink has surged significantly over the past week, outperforming other stocks in the industry. According to on-chain data, here are the factors driving this trend.

Chainlink's price has recently soared

The past few weeks have been a great time for LINK investors, as the asset's value has nearly doubled compared to early November. At the beginning of this week, the token faced some setbacks, but strong bullish momentum has returned in recent days.

The chart below shows LINK's performance over the past few months:

From the chart, it can be seen that after jumping over 47% from the bottom earlier this week, Chainlink has successfully broken through the $28 mark. The asset's current weekly gain exceeds 22%, making it the best performer among the highest market cap cryptocurrencies.

Speaking of market cap, by this metric, LINK is currently the 12th largest company in the industry, just above Shiba Inu (SHIB).

From the table above, it is evident that Chainlink's next competitor is Avalanche (AVAX). Its market cap is still $3.5 billion higher than LINK, so assuming the bullish momentum does not fade, it will take some time before a reversal occurs.

As for the reasons driving the cryptocurrency surge, perhaps on-chain data can provide some clues.

LINK Sharks and Whales Have Been Busy Accumulating

In a recent post on X, the on-chain analytics firm Santiment discussed the behavioral differences between small and large entities on the LINK network. The relevant metric here is 'Supply Distribution,' which tracks the total amount of Chainlink currently held by a given group of wallets.

In the context of the current topic, the two address ranges of interest are 0 to 100,000 coins and 100,000+ coins. At the current exchange rate, the 100,000 boundary between these two groups translates to approximately $2.8 million.

Addresses holding above this value are considered key market investors, referred to as sharks and whales. Therefore, the supply distribution of this group tracks the behavior of large investors.

Now, here is the chart shared by the analytics company, showing the comparison of this metric between sharks and whales versus regular investors: