Centralization in Token Distribution

According to recent data from a crypto market data aggregator, it’s been revealed that the distribution of Chainlink’s (LINK) tokens is reaching alarming levels of centralization. More than 80% of LINK that is outside of exchanges is currently held within the top 1% of all Chainlink wallets. This prompts the burning question: Is this an alarming trend for investors or just a sign of confidence?

The Whale Effect

Digging deeper into these statistics, Glassnode found that a whopping 81% of LINK outside of crypto exchanges—essentially smart contracts—is tucked away in a mere 125 wallets. It’s a little like finding out that the vast majority of a pizza is going to just a couple of really hungry friends.

Data Insights From Etherscan

To put this in even more perspective, Etherscan reports that if we consider the tokens held on exchanges as well, a staggering 82.7% of LINK is owned by only 100 wallets. Yes, you read that right—less than 0.03% of LINK-holding addresses are hogging nearly four-fifths of the supply. Yet, with only about 12,500 of these addresses currently active, it shows an eyebrow-raising dynamic where 83% of LINK’s supply is just chilling in 0.8% of active wallets.

The Accumulation Trend

It seems Chainlink’s so-called whales have been on a shopping spree since July 2019. The share of supply held by the top 1% of LINK holders has waxed and waned but notably shot up from 53% to 81% in just a year and a half. Who knew that accumulating tokens could become a hobby? It’s like collecting stamps but with more zeros involved.

Whales vs. Core Team Sell-Offs

Interestingly, as the big fish swim in deeper waters with their relentless accumulation, Chainlink’s core team seems to be moving in another direction—selling off a significant portion of their private stash. Glassnode tracked about 52 million LINK that have been moved out of the reserve wallets belonging to the team over the past 100 days. Curious timing, isn’t it? Almost like a plot twist in a crypto thriller.

Chainlink’s Rise in the Crypto World

Since establishing itself as the go-to oracle network in 2020—with some pretty stellar partnerships, including one with the tech giant Google—Chainlink has dramatically influenced the cryptocurrency landscape. On January 18 of this year, it even flipped Bitcoin Cash to claim the title of the eighth-largest cryptocurrency by market cap. Talk about a glow-up!