LINK price slightly increased amid Chainlink cost Venus Protocol $11.2 million

Although Chainlink (LINK) is not a traditional cryptocurrency, there is a significant number of investors holding over $3 billion in capitalization. This is all thanks to the use cases it presents for cross-chain DeFi protocols.

In the past 24 hours, LINK has recovered more than 12.05% after dropping to $5.2 and is currently trading at $7.55. This comes as one of Chainlink’s biggest products has been affected by the collapse of another protocol.

Chainlink’s price feed is based on hundreds of dApps and protocols. In fact, the total number of projects in its ecosystem surpassed the 1,000 mark just last year.

However, when TerraUSD (UST) and LUNA experienced problems recently, Chainlink paused price updates. Currently, UST and LUNA are trading at $0.18 and $0.0002, respectively, affecting not only investors but also protocols and platforms in the DeFi space.

As both assets lost all value and utility, Chainlink has paused price updates in the price feed.

As a result, Venus Protocol lost more than $11.2 million. According to the team, due to Chainlink – Venus’s price data feed – suddenly stopped updating the price of LUNA, the final price of LUNA on Venus was recorded as $0.107 when in fact, it had dropped to $0.01.

Therefore, upon discovering this vulnerability, the hacker deposited 230 million LUNA (worth more than $24 million) and borrowed about $13.5 million. Following the attack, Venus announced the suspension of the protocol.

However, Chainlink holders seem unaffected by the events that have taken place over the past few days. In contrast, May 13 is the most active day after nearly a month.

When LINK rose to trade at $7.1, over 5.8k investors – the highest level since January – made 8.26k trades, a level not seen since January 10, 2021. As a result, it pushed the trading volume beyond $313 million.

This could be an attempt to book profits amid a bear market or an exit strategy to prevent further declines, as currently, 81.29% of LINK holders are at a loss.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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