Chainlink Can Make a Turnaround Based on Its Appeal With Developers

Chainlink - Chainlink Can Make a Turnaround Based on Its Appeal With Developers

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Chainlink (LINK-USD) is a secondary cryptocurrency, ranked #23 by Coinmarketcap with a $6.59 billion market capitalization. But so far this year LINK has had a difficult year so far. After closing at $20.67 on Dec. 31, LINK-USD is now at $14.08, as of April 17, 2022. This means its performance year-to-date (YTD) is down almost 32% (i.e., -31.9%).

Its performance is also highly correlated with Ethereum (ETH-USD), the second-largest cryptocurrency with a $369 billion market cap as of April 17. One for this correlation is that developers want to transform Chainlink into a large smart contract blockchain network, just like Ethereum. Ethereum is the largest smart contract platform so far. It has the most decentralized finance (DeFi) apps and other DApps (decentralized apps). DeFi smart contracts allow people to do staking or yield farming with cryptocurrencies.

Chainlink Is Appealing to Developers

Chainlink has become a blockchain platform of choice for certain new DeFi apps. For example, a new app called Reputation DAO (which stands for decentralized autonomous organization) helps people who normally have to put up a large amount of collateral for a DeFi loan. Typically the crypto lender requires 150% collateral for the loan amount. Reputation, using the Chainlink platform, has a data service using Chainlink that reduces the risks to DeFi lenders willing to offer loans with less collateral.

The reason is that Chainlink is known as an “oracle” network. It provides a way to securely connect smart contracts to off-chain data and services. It provides tamper-proof inputs, outputs, and computations to support advanced smart contracts. As a result, Chainlink is the go-to platform for smart contracts that need to connect data to the outside world.

Moreover, Chainlink is now gaining a reputation as a viable platform to develop non-fungible tokens (NFTs). Chainlike Labs recently posted on Twitter (NASDAQ:TWTR), that it can provide a competitive and dynamic edge for NFT developers who want to develop NFT marketplaces.

As a result, Chainlink is gaining an edge in the smart contract arena that gives it an edge. As a result, it could soon make a turnaround in its performance.

On the date of publication, Mark Hake did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Mark Hake writes about personal finance on mrhake.medium.com, Newsbreak.com and Beehiiv.com.


Article printed from InvestorPlace Media, https://investorplace.com/2022/04/chainlink-is-gaining-appeal-with-smart-contract-and-nft-developers/.

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