Analysts predict a new Chainlink (LINK) ETF as LINK tokens gain utility in real-world asset tokenization. ARK Invest's use of LINK in Bitcoin ETFs suggests imminent developments. Explore the potential and impact on LINK's price.
Analysts closely monitoring on-chain developments are anticipating the imminent launch of a novel exchange-traded fund (ETF) centered around Chainlink (LINK). The utility of LINK tokens has been steadily growing within the tokenization realm, especially as companies transition from conventional blockchain ETFs to the tokenization of tangible real-world assets.
A keen-eyed analyst has drawn attention to the noteworthy use of LINK by ARK Invest in substantiating its Bitcoin holdings, suggesting a potential harbinger of an impending ETF launch.
Unlocking the Potential for a Chainlink ETF
ARK Invest's ETF collaborator, 21 Shares, presently holds an impressive 693,639 LINK tokens. Notably, this ETF provider extends these tokens exclusively to institutional investors, underscoring an existing market demand for a Chainlink ETF. According to ARK CEO Cathie Wood, 21Shares stands as the world's leading crypto ETF provider.
Furthermore, 21Shares has seamlessly integrated Chainlink’s Proof of Reserves to authenticate its Bitcoin holdings for the Ark 21Shares Bitcoin ETFs. LINK is utilized to compensate external data providers ensuring accuracy in reporting ARK’s Bitcoin holdings. This innovative approach establishes a new use case for the LINK token, safeguarding the ETFs of various cryptocurrencies through LINK rewards.
The surging demand has left its mark on the LINK token's price, reaching a yearly pinnacle of $20 on February 12, 2024. Simultaneously, the Grayscale Chainlink Trust, tracking LINK's price, recently achieved $125.
Grayscale, as the Trust operator, was an early pioneer in the crypto ETF landscape, introducing the first regulated avenue for institutions to trade Bitcoin. The company has also submitted an application to transform its Ethereum Trust into an ETF, potentially positioning it as the premier provider for a fund directly mirroring the LINK price.
Regrettably, Grayscale has not responded to inquiries regarding a possible Chainlink ETF as of the time of this publication.
Tokenization Spurs Increased Demand for LINK
The price trajectory of LINK could experience further upward momentum as institutions broaden their horizons from ETFs to blockchain tokenization. Chainlink's CEO, Sergei Nazarov, shared with Bloomberg that institutions are poised to establish a distinctive token economy following the fervor surrounding crypto ETFs.
Noteworthy in Chainlink's arsenal are its oracles, which serve as external data feeds delivering real-world data to blockchain infrastructure. In the context of tokenized assets, these oracles play a crucial role in verifying that a bank possesses the requisite collateral to support any assets issued on-chain.