Chainlink has quickly won the trust and interest of many users and this is clearly reflected in the development of the LINK token. In fact, the altcoin rose 330% in May, reaching as high as $ 54. However, due to a market-wide correction, LINK fell 67%. In the midst of the market downturn, the on-chain indicators also return to the level last seen in 2020.

Network growth index is slowing down

Chainlink’s network growth has dropped to its October 2020 low. Furthermore, as reported by Santiment, the current lower reading could be a bearish sign unlike October 2020 when the network growth index fell and formed a bullish divergence for the price of LINK, and this too is evidenced by the price of LINK.

LINK price (green) and network growth index (purple) | source: Mood

The above character is confirmed by the decrease in the number of active addresses over the past 3 months. This is a period when volatility is significantly high across the market. However, contrary to expectations, the number of active addresses has fallen by almost 50% since April.

In fact, “Shiba Inu has more active addresses than Chainlink”.

LINK price (green) and number of addresses that are active 24 hours a day (purple) | source: Mood

The graph above shows a significant difference in the number of active addresses from April to June. In fact, the data shows that only about 5,000 daily addresses are currently active on the network.

Although the number of active addresses remains small, the influx to the exchanges has increased recently. Especially this week when the broader market correction pushed LINK prices to new monthly lows. Panic sales and the surrender of the dealers follow.

So it may be worth being optimistic that this will be viewed as a sign of a bottom and that the price is likely to reverse from here.

At the time of writing, LINK is trading around the $ 17.3 mark as volatility in the market continues to rise. With the growth of the LINK network struggling, retailers cannot support the price either, so LINK is well on its way to dropping to levels last seen in January 2021.

LINK / USD | Source: Tradingview

You can see the LINK price here.

Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

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