- Chainlink price has been in a strong sell-off in the past few months.
- The bearish trend is still intact until it moves above the 50-day MA.
The Chainlink price has struggled in the past few weeks as concerns about the decentralized finance (DeFi) industry continued. LINK is trading at $7.56, which is about 42% above the lowest level in May. The coin remains about 86% below its all-time high, bringing its total market cap to about $3.52 billion.
DeFi concerns remain
The blockchain industry has many challenges. One of the most notable ones is how to integrate off-chain data to the on-chain environment in a way that is secure.
Chainlink is one of the solutions that is helping solve this challenge. It is an oracle that helps hundreds of developers to connect outside data to the blockchain.
There are many examples of this. For example, a developer building a blockchain-enabled stock exchange needs to incorporate real data about stocks. Chainlink can help them do this in a simple step.
Learn how to buy Chainlink.
Chainlink is now used mostly in the Decentralized Finance industry. For example, well-known DeFi platforms like AAVE, Compound, Iron Bank, and Cream Finance use it for its price feeds.
Therefore, the Chainlink price has been affected substantially by the recent collapse of Terra’s ecosystem. This collapse led to a sharp deterioration of key DeFi ecosystems like Anchor Protocol and Astroport, which used Chainlink’s products.
At the same time, the collapse saw many investors give up on DeFi since most of them lost a lot of their life savings.
As a result, the total value secured (TVS) in Chainlink’s ecosystem has crashed from more than $60 billion a few months ago to just $23 billion. In the past 30 days, the TVS has dropped by 24%.
Chainlink has also seen a lot of competition from the likes of Dia, TWAP, UMA, and Reserve Oracle among others.
Chainlink price prediction
The daily chart shows that the LINK price has crawled back in the past few weeks. It has risen from last month’s low of $5.27 to the current $7.5. This price action mirrors that of other cryptocurrencies like Bitcoin and Ethereum.
Chainlink remains below the 25-day and 50-day moving averages while the MACD remains below the neutral level.
Therefore, while the coin has recovered slightly, the bearish trend will likely continue in the coming weeks. It will continue as long as it is below the 50-day moving average. As such, a retest of May’s low of $5.27 cannot be ruled out.
