tl;dr
Breaking news: Bitwise, the crypto asset manager behind some of the most successful ETFs in the space, is making a bold move with a new filing to launch a Chainlink ETF. This fund would directly hold LINK, the native token of Chainlink’s oracle network, marking a significant step in the evolution of...
Breaking news: Bitwise, the crypto asset manager behind some of the most successful ETFs in the space, is making a bold move with a new filing to launch a Chainlink ETF. This fund would directly hold LINK, the native token of Chainlink’s oracle network, marking a significant step in the evolution of crypto ETFs. The filing, which hasn’t yet revealed a ticker symbol, highlights Coinbase Custody Trust Company as the custodian—a choice that mirrors the approach taken by giants like BlackRock for its iShares Bitcoin and Ethereum Trusts. This isn’t just a logistical detail; it signals confidence in the infrastructure supporting crypto ETFs, a sector still grappling with regulatory scrutiny and market volatility.
What makes this ETF unique? It would allow for *in-kind creation and redemption*, a feature that’s only recently been permitted by the SEC. In simpler terms, investors could swap shares for actual LINK tokens when selling, or deposit LINK to get shares. This mechanism, common in traditional markets, is now making its way into crypto, potentially reducing the risks of price manipulation and improving liquidity. It’s a game-changer for a market that’s long struggled with inefficiencies.
Bitwise isn’t stopping there. The firm has also filed for ETFs tracking Solana, XRP, Dogecoin, and Aptos, signaling a broad push to diversify the crypto ETF landscape. Its existing Bitcoin and Ethereum ETFs have already attracted $2.2 billion and $461 million in net inflows, respectively, a testament to the growing appetite for institutional-grade crypto products.
But the market isn’t celebrating just yet. Despite the ETF filing, LINK’s price has cooled from a high of $24.70 to $24.27, a 1.1% drop as of writing. Trading volume has dived 14.3% to $3.8 billion, while open interest—essentially the value of open bets on futures and options—has fallen 5% to $1.7 billion. The broader crypto market is also in turmoil, with Bitcoin dipping below $110,000 amid uncertainty over the Federal Reserve’s next moves.
Yet, there’s still optimism. David Attermann of venture capital firm M31 recently argued that Chainlink’s deep integration into banks, market infrastructure, and major crypto protocols creates a “high switching cost” barrier for competitors. This, he believes, could lead to sustained revenue growth—a thesis that might soon be tested if Bitwise’s ETF gains traction.
So, where does this leave investors? Bitwise’s filing is a clear sign that the crypto ETF landscape is maturing, but the market’s mixed reaction to LINK’s price and broader crypto weakness suggests caution is still warranted. For now, the stage is set for a high-stakes showdown between regulatory progress, market sentiment, and the enduring appeal of projects like Chainlink.