Chainlink (LINK): What Happens After This Wallet Is Emptied?
There is approximately 4 Million LINK left on 1 of 6 publicly known Chainlink team wallets:
0xf37c348b7d19b17b29cd5cfa64cfa48e2d6eb8db
Two days ago, 1.5 Million LINK were transferred out. One week before that other 1.5 Million. And two weeks before that too.
To put it simply, this must mean that most probably we’re 3 weeks away from emptying this wallet.
Ok but, what does that mean?
Token Distribution
Let’s begin to remember how the tokens have been distributed.
There is a maximum supply of 1 Billion tokens. This is the total number of LINK that will be ever created. This is still far from being the number of LINK in the circulating supply. As of today, there is only 408.5 Million LINK of circulating supply. That’s only~40.85% of the maximum supply.
On its ICO, this was how LINK was distributed:
- 35% to Node Operators
- 35% to the Public Token Sale
- 30% to the Company
So, 300 Millions LINK go to the company, in 6 publicly known Chainlink wallets with 50 Million LINK each (in 2017).
Those are the wallet addresses with the current LINK balance (obviously some with less than 50 Million now):
- 0xf37c348b7d19b17b29cd5cfa64cfa48e2d6eb8db (4.09 Million)
- 0xe0362f7445e3203a496f6f8b3d51cbb413b69be2 (50 Million)
- 0x75398564ce69b7498da10a11ab06fd8ff549001c (50 Million)
- 0x5560d001f977df5e49ead7ab0bdd437c4ee3a99e (50 Million)
- 0xdad22a85ef8310ef582b70e4051e543f3153e11f (37.4 Million)
- 0xbe6977e08d4479c0a6777539ae0e8fa27be4e9d6 (50 Million)
NB. For the sake of readability I’ve numbered the wallet addresses.
So the circulating supply has been increasing since 2017 with transactions mostly from Chainlink’s Team wallets 1 and 5 to other wallets (e.g. exchanges).
Most wallets have stayed untouched but those two. The last transaction out of the wallet 5 occurred August 2019 and to this day it has 37.4 Million LINK. The wallet 1 has been the more active and has still 4.09 Million LINK:
0xf37c348b7d19b17b29cd5cfa64cfa48e2d6eb8db
If we keep the same rate of the previous weeks, we’re 3 weeks away from emptying this wallet.
So the question is, what happens next?
The first question that comes to mind would be why do the company need to have so much tokens available to them? The second, probably, why do they need to sell so much in a so short time period?
But somehow, I’m not so much interested on these questions now, but instead, on what happens when this wallet goes to zero (or a small amount)?
Let’s figure out what people think! Let’s query Twitter #Chainlink and $LINK!
After allowing a poll to run for couple of hours, most expect that when the wallet goes to zero the price will go up.
But, there are other wallets still, and the Chainlink team can just move to another wallet (for example, the number 5) and keep selling.
NB. the poll is active while I’m writing this and for 24 hours, so expect these numbers to change although I’m confident enough that the conclusions won’t.
On another poll, it looks like most people don’t even recognize that this is happening and we are so close to emptying this wallet.
Of course, one could say that this wallet would never be emptied out because a few thousand LINK could be left there. But that’s the same as if they have left 0 LINK there.
Anyway, what’s important here is not if that wallet is emptied…
…but what happens after that?!
They keep selling
If they keep selling we can assume this will go on for as long as there are balance available on any of the other wallets. Obviously, I’m not expecting they would sell all, or even most of it. But, they have enough to keep this for some more years.
This is the most probable scenario, but the less interesting too.
They stop selling (temporarily, of course!)
A lot more interesting.
They have been selling in 1 week intervals (on Fridays). There are 2 to 3 transactions of half a million LINK each in one day and again 1 week after that, at least for the past few weeks. So after the wallet is emptied, if one more week goes by without them moving LINK from one of the their wallets, you have your answer there. Make it 2 weeks or 1 month without movement, to be sure. The longer it gets, the louder the message will get.
Check movements on address 1 on the following dates:
- February 26 (They could move everything left in one go here)
- March 5 (…or here)
- March 12 (if same frequency is kept, that would be the date)
Who knows what will happen?
I don’t know. But let’s entertain the idea for a moment that they do stop selling for some time.
This is one of those cases, where the why they would do that becomes less important than for how long.
Wouldn’t you say that 50 Million+ LINK would be enough to support the development of the Chainlink protocol for some time?
We’re most probably 3 weeks away from emptying the wallet, and 4 weeks away to find out what comes next.
I’m updating this idea on TradingView.
