Chainlink (LINK), a prominent oracle network that facilitates data supply for smart contracts, is currently experiencing significant market fluctuations. The cryptocurrency has observed a substantial decline, plummeting over 70% from its peak in the previous year. Despite this downward trend, there is a notable increase in institutional backing, particularly from Grayscale Investments, which has expanded its holdings of LINK to new heights.
Recent reports from blockchain analytics firm Arkham Intelligence reveal that Grayscale’s LINK holdings reached over 5 million tokens as of February 2026. Currently, the firm possesses approximately 5.258 million LINK, with this quantity valued at more than $43 million. The data indicates that Grayscale has been strategically accumulating LINK, having purchased around 4 million tokens since December of the previous year, coinciding with LINK’s price drop from $15 to as low as $7.2.
This accumulation trend highlights a paradox in the market: while LINK faces considerable short-term selling pressure, there is a growing appetite among institutional investors for exposure to the asset. Interest has been further bolstered by the performance of LINK-focused exchange-traded funds (ETFs), which, since gaining regulatory approval, have reported no days of negative net flows. Although the average daily net inflow remains below $1 million, the absence of outflows showcases investor confidence in LINK’s long-term growth potential.
The current climate is markedly different from other cryptocurrency ETFs, which often exhibit erratic capital flows in response to market sentiments. Analysts attribute the relative stability surrounding LINK to its critical infrastructure role within decentralized finance (DeFi) and various blockchain applications. As a provider of dependable data feeds, Chainlink plays an essential part in the functional integrity of lending platforms, derivatives markets, and prediction markets, thereby continuing to attract institutional capital seeking enduring returns.
Moreover, Chainlink’s recent partnership with Polymarket, a leading blockchain-based betting platform, has further solidified its relevance. Data from Dune Analytics highlight that Polymarket’s monthly notional volume surged to an unprecedented peak of more than $7 billion, suggesting that Chainlink’s infrastructure capabilities could be instrumental in enhancing its long-term value proposition.
Despite these positive indicators, LINK’s current market performance is marred by ongoing selling pressure, pushing market sentiment into extreme fear territory. Several analysts warn that LINK might enter a prolonged sideways accumulation phase, reflecting its undervaluation. Investor Greeny noted the importance of a time-based capitulation, alluding to the 1.5 years it took for LINK to establish a bear market bottom in 2023.
Overall, the landscape appears poised for a waiting game, with many investors withdrawing capital from altcoins. Future capital injections may favor projects with robust real-world applications, raising the stakes for LINK as it strives to navigate the current market challenges while maintaining institutional interest.
