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Following the quiet launch of a new Chainlink exchange-traded product (ETP) by Bitwise, Matt Hougan—Chief Investment Officer at the crypto asset manager—argues that the market continues to misunderstand one of the most critical infrastructures in the digital asset ecosystem. Despite Chainlink’s dominant role across stablecoins, DeFi, tokenization, and institutional-grade crypto infrastructure, Hougan believes LINK may be significantly undervalued.
In a recent memo, Hougan described Chainlink as “one of the most misunderstood yet essential assets in crypto,” noting that its importance is often overshadowed by simpler narratives surrounding Bitcoin and Ethereum. While Bitcoin is commonly framed as “digital gold” and Ethereum as the leading smart contract platform, Chainlink does not fit neatly into a single, easy-to-market category.
Although the newly launched Chainlink ETP recorded modest trading volumes and tight spreads, it failed to generate the same excitement seen during earlier Bitcoin ETP launches. According to Hougan, this muted response reflects a broader issue: many investors still underestimate what Chainlink actually does.
Often labeled merely as a “data oracle,” Chainlink’s role extends far beyond providing price feeds. Hougan emphasizes that Chainlink has evolved into a high-growth software platform designed to solve one of blockchain’s core limitations—the inability of isolated networks to securely interact with each other and with real-world data and systems.
Today, Chainlink commands a dominant market share—ranging from roughly 50% to near-total control—in multiple critical infrastructure services. These include price feeds for stablecoins, cross-chain interoperability, proof-of-reserves mechanisms, and secure messaging between blockchains and traditional financial systems.
Bitwise highlights that many of the fastest-growing areas in crypto, particularly those with strong institutional participation, rely heavily on Chainlink’s technology. Tokenization initiatives use Chainlink for pricing, asset servicing, and compliance-related workflows. DeFi protocols and prediction markets depend on its infrastructure to function reliably at scale.
Hougan also points to Chainlink’s deep integration with major global institutions, including DTCC, SWIFT, JPMorgan, BNP Paribas, Visa, Mastercard, Euroclear, Fidelity, Franklin Templeton, FTSE Russell, Coinbase, Aave, Deutsche Börse, and Polymarket. This level of adoption, he argues, positions Chainlink as a foundational layer for bringing traditional financial markets on-chain.
From a market perspective, LINK has experienced heightened volatility in recent weeks. After consolidating in late December, the token rallied in early January and briefly moved above $14 before losing momentum and pulling back toward the $12.30 area.
On-chain analytics firm Santiment reports that large LINK holders have been accumulating during this pullback. Data shows that the top 100 LINK wallets increased their holdings as prices dipped below $13, while retail investors reduced exposure amid fear and impatience—behavior often observed during market corrections.
According to Santiment, this divergence between whale accumulation and retail selling may indicate long-term confidence among larger participants, even as short-term sentiment remains fragile.
As institutional adoption of blockchain infrastructure accelerates and more financial assets migrate on-chain, Hougan expects demand for Chainlink-based investment products to grow accordingly. Whether the market fully reprices LINK to reflect its role remains an open question—but one that continues to fuel debate among investors.
This article is for informational purposes only and does not constitute investment advice. Readers should conduct their own research and are solely responsible for their investment decisions.
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