Data shows Chainlink address activity has returned to 2021 levels recently, a sign that could turn out to be bullish for the asset’s value.
Chainlink Daily Active Addresses At High Levels Recently
According to data from the on-chain analytics firm Santiment, this increase in LINK activity first started around two months ago. The relevant indicator here is the “daily active addresses,” which tells us the total number of addresses that were involved in a transaction on any given day.
The metric counts both senders and receivers in its calculation, and only accounts for unique addresses in the data, meaning that the wallets that participated in multiple transfers on the same day are only counted once. This helps remove duplicate transactions and other noise from the data, and provides a more accurate picture of the network activity.
When the value of this indicator is high, it means a large number of daily users are interacting in some way on the blockchain right now. Such a trend shows the market is active currently.
On the other hand, low values of the metric imply not many unique users are showing trading activity at the moment. This kind of trend can be a sign that the general interest around the crypto is low at the moment.
Now, here is a chart that shows the trend in the Chainlink daily active addresses over the last few years:
Looks like the value of the metric has been elevated in recent weeks | Source: Santiment on Twitter
As shown in the above graph, the Chainlink daily active addresses were at pretty low levels for most of 2022. This was because the investors weren’t finding the coin that interesting to trade during the bear market consolidation.
In the last couple of months or so, however, there has been a very noticeable rise in the unique users transacting on the network daily. In fact, these values of the indicator are similar to those seen during 2021, when the bull run was going on.
Usually, high network activity is bullish for the price in the long term as increased utility of the chain builds a more sustainable ground for the future. LINK has been rallying in the last week or so, which may suggest that this high activity from holders in the last two months may already be paying off for the crypto.
Also, while a high number of users are important for starting price moves like this, it’s also true that they are needed during such rallies to keep them going. If the Chainlink daily active addresses continue to be at the current high levels, then it may mean the current rally can keep up the momentum for a while longer.
LINK Price
At the time of writing, Chainlink is trading around $6.3, up 13% in the last week.
The value of the asset seems to have surged in the last few days | Source: LINKUSD on TradingView
Featured image from Paolo Feser on Unsplash.com, charts from TradingView.com, Santiment.net
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