The Grayscale Chainlink Trust, known as GLNK, has been recording a 200% premium compared to current LINK market prices. GLNK has seen a remarkable rise of almost 100% over the past week, ending Monday at $39, compared to $21 on October 31.
It is worth noting that the price of LINK has more than doubled in the last three weeks, amid the broader recovery in the cryptocurrency market.
According to CoinMarketCap, the 12th largest cryptocurrency by market cap has seen an increase of around 25% in the last week alone and was trading at $13.50.
The discrepancy was first noticed by popular Chainlink influencer known as ChainLinkGod, who highlighted that Grayscale trusts are not redeemable.
This essentially implies that they represent a “one-way door” and cannot be “efficiently arbitraged against the spot market” despite the asset manager’s attempt to convert its GBTC product into a callable ETF.
Chainlink (LINK) on the rise
He noted that although GLNK’s Total Assets Under Management (AUM) is only around $4 million, it is interesting to see growing demand for a product aimed at institutional investors. Furthermore, a report from CoinShares revealed that the product has attracted $2 million in flows in recent weeks.
LINK’s monthly rise of more than 85% has several factors at play. Firstly, LINK’s non-zero balances have skyrocketed, suggesting an increase in activity on the blockchain.
Accumulation by whales also appears to be solid, with one entity purchasing 312,901 LINK. According to Lookonchain, the whale in question purchased more than $3.81 million in LINK tokens this week.
The adoption of Chainlink’s Cross-Chain Interoperability Protocol (CCIP) by institutions and projects across multiple blockchains could also be another factor driving LINK’s price.
Touted as the “new gold standard” for cross-chain interoperability, CCIP was launched on Mainnet Early Access in July and has been incorporated into networks such as Ethereum, Polygon, Avalanche, Polygon, Optimism, Arbitrum and Base.
Global financial messaging network SWIFT also announced it has successfully conducted a series of blockchain interoperability tests with various financial institutions such as Citi, SIX Digital Exchange (SDX), BNP Paribas and BNY Mellon using the protocol.
CCIP is also being used for value exchange in Hong Kong Central Bank Digital Currency (CBDC) trials. With these developments, LINK continues to show its resilience and attract increasing attention from institutional investors.