LINK Is Up 24% in Weeks: But This Key Growth Metric Is Barely Moving

Market Analysis## Chainlink's LINK has experienced a significant price surge of 24% since the start of September. However, the latest on-chain data from Santiment reveals an unusual disconnect between the price growth and wallet creation. New wallet creation has barely moved in the right direction, averaging only 1,249 new addresses per day during the four weeks ending October 6, compared to 1,225 during the four weeks leading up to September 1. This modest increase of less than 2% is notable, especially when compared to other chains such as Solana, which saw a 33% increase in new addresses alongside a 20% price surge. Ethereum, on the other hand, showed a more modest price increase of 11% during the same period. It is worth noting that Santiment's metric only counts LINK activity on Ethereum mainnet, so it does not capture tokens bridged through Chainlink's Cross-Chain Interoperability Protocol (CCIP) or held through exchange-traded products. The contrast between Chainlink's performance and other chains is particularly striking, as it suggests that the token's price growth may not be driven by a significant increase in demand.## ## Market Trends## The price correction of LINK has raised questions about whether demand is keeping pace with the recent rally. The token's price has corrected, falling to $13.40 as of press time, and further on-chain data from Onchain Lens shows that GSR has transferred another 303,010 LINK to Binance after receiving the tokens from a Gnosis Safe. This transfer adds to the selling pressure, and similar developments could intensify the immediate selling pressure. However, it is also possible that smaller investors may follow suit, adding to the selling pressure. The lack of a significant increase in new wallets also suggests that the rally may not be driven by a large influx of new investors.## ## Conclusion## In conclusion, the disconnect between Chainlink's price growth and wallet creation is a cause for concern. The token's price surge has not been accompanied by a significant increase in demand, and the latest on-chain data suggests that the rally may be driven by smaller investors. As the market continues to correct, it will be important to monitor the on-chain activity and wallet creation to determine the underlying drivers of the price movement.