Chainlink Unlocks 19M Tokens and Its Impact on LINK

Chainlink has unlocked 19 million tokens (worth $269 million) on March 15 as part of its quarterly schedule, according to Spot On Chain.

> “14.875M $LINK ($212.9M) was sent to #Binance. 4.125M $LINK ($56.2M) was transferred to multi-sig wallet ‘0xD50’.”

Despite this significant token release, LINK saw a 6% rise following Bitcoin’s rebound to $85,000. This raises questions about LINK’s ability to withstand the unlock event without a price drop.

LINK’s Post-Unlock Analysis

The amount unlocked was similar to February 2024 but lower than the 21 million tokens released in June last year. Historical data shows that LINK typically faced red daily session closes after unlocks, except for September. However, it usually rebounds after a couple of days unless Bitcoin falls further.

Interestingly, before the unlock, major whale wallets (holding 10-100M LINK) sold about 13 million tokens, whereas wallets holding 1-10M LINK absorbed this offloading. The large whale wallet group now holds 467.63 million LINK tokens.

On the trading front, a notable player took a long position of $7.1 million in LINK just hours before the unlock, but ended up selling at a loss. Spot On Chain reported,

> “The ‘50x ETH’ whale dumped 1.34M $LINK on-chain for $18.36M at ~$13.7, losing $512K (-2.7%).”

AMBCrypto further analyzed LINK’s selling pressure on centralized exchanges to predict its future direction. While sell pressure appeared stable, it increased slightly ahead of the unlock event, with exchange reserves rising from 30.8M tokens to 31M tokens.

Derivatives exchange reserves also surged, indicating heightened volatility and liquidation risks due to leverage.

From a technical perspective, LINK has bounced from its descending channel range lows. If upward momentum continues, it could reach the $16-$17 mid-range, but sustained selling could push LINK down to levels seen during the November U.S. elections, around $10.