Bitwise Files for First Spot Chainlink ETF, Boosting LINK Price

TLDR

• Chainlink (LINK) price rebounded by 5% after Bitwise filed for a Chainlink ETF with the SEC.
• The Bitwise Chainlink ETF aims to store tokens securely with Coinbase Custody Trust Company.
• If approved, the ETF will allow in-kind and cash-based creation and redemption of LINK tokens.
• The filing could open doors for institutional investors like pension funds and hedge funds to invest in LINK.
• Chainlink’s strategic partnerships in the DeFi ecosystem continue to grow, further supporting LINK demand.

Chainlink (LINK) price rebounded 5% from an intraday low of $22.94 on Tuesday, August 26, following a significant development. This price surge occurred after asset manager Bitwise filed its Form S-1 registration statement with the U.S. Securities and Exchange Commission (SEC) for a Chainlink ETF. At the time, LINK traded at approximately $23.96, reflecting a 1.9% drop in the past 24 hours.

Chainlink ETF Could Boost LINK Demand

Bitwise’s filing to launch the Chainlink ETF marks a key milestone for the asset manager. According to the S-1 registration statement, Bitwise will collaborate with Coinbase Custody Trust Company for secure storage of the acquired tokens. If the SEC approves the filing, it could lead to significant capital influx into the Chainlink ecosystem, boosting LINK’s demand.

The Bitwise Chainlink ETF will allow both in-kind and cash-based creation and redemption. As the filing explicitly states, the fund will not engage in active trading of LINK tokens. This passive approach may encourage institutional investors who favor less active trading strategies.

For the review process to begin, an exchange must file a 19b-4 filing to list the shares of the Chainlink ETF. Once that happens, the SEC will go through its standard process, including initial reviews, public comments, and possible amendments. A final decision will follow after the review stages.

Institutional Demand for LINK and DeFi Integration

The approval of the Bitwise Chainlink ETF would allow institutional investors, such as pension funds and hedge funds, to invest in LINK. This could drive up demand and price for Chainlink. “This move highlights the growing institutional interest in LINK,” said Bloomberg analyst Eric Balchunas.

In addition to the ETF filing, Chainlink has been solidifying its position within the DeFi ecosystem. The network has formed strategic partnerships with various institutions, including Japan’s SBI Group. Through this partnership, SBI will leverage Chainlink’s Cross-Chain Interoperability Protocol (CCIP) to explore cross-chain tokenized real-world assets.

Overall, the Bitwise Chainlink ETF filing represents a significant step toward greater institutional participation in Chainlink’s ecosystem. As more investors turn to LINK, both its price and role within decentralized finance could experience considerable growth.

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