The data shows that Chainlink management activity has recently returned to 2021 levels, a sign that could prove bullish for the asset’s value.
Chainlink Daily Active Addresses at High Levels Recently
According to data from the on-chain analysis firm holyday, this spike in LINK activity started about two months ago. The relevant indicator here is the “daily active addresses”, which tells us the total number of addresses that participated in a transaction on a given day.
The metric counts both senders and receivers in its calculation, and only takes into account unique addresses in the data, which means that 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 flag is high, it means that a large number of daily users are somehow interacting on the blockchain at the moment. Such a trend shows that the market is currently active.
On the other hand, the low values of the metric imply that not many unique users are showing trading activity at the moment. This type of trend may be a sign that general interest in cryptocurrencies is low at the moment.
Now, here’s a chart showing the trend in Chainlink’s daily active addresses over the past few years:
Looks like the value of the metric has been elevated in recent weeks | Source: Santiment on Twitter
As shown in the chart above, Chainlink’s daily active addresses were at fairly low levels for most of 2022. This was because investors did not find the coin all that interesting to trade during bear market consolidation.
However, in the last few months or so, there has been a very noticeable increase in unique users transacting on the network on a daily basis. In fact, these indicator values are similar to those observed during 2021, when the confinement was going on.
Typically, high network activity is bullish for price in the long run, as higher on-chain utility creates more sustainable ground for the future. LINK has been rallying for the past week, which may suggest that this high headline activity over the past two months may already be paying off for the crypto.
Also, while a large number of users is important to initiate price moves like this, it is also true that they are needed during such rallies to keep them going. If Chainlink’s daily active directions continue at the current high levels, then it may mean that the current rally may sustain momentum for a while longer.
LINK Price
As of this writing, Chainlink is trading around $6.3, up 13% over the past week.
The value of the asset seems to have surged in the last few days | Source: LINKUSD on TradingView
Featured Image by Paolo Feser on Unsplash.com, Charts from TradingView.com, Santiment.net
