Chainlink's ETF Push and Falling Reserves Create High-Stakes Price Tightrope

Chainlink (LINK) appears to be entering a period of volatility as recent market data indicates a potential price squeeze driven by declining exchange reserves. On September 1, 2025, the token was trading at $24.03, having seen a 20% increase over the previous month, outperforming the average growth rate of the DeFi category by 4 percentage points [1]. Despite this upward movement, analysts suggest that falling exchange reserves may create downward pressure on the token in the near term.

A significant development in the Chainlink ecosystem occurred when Bitwise, a major digital asset manager, submitted an S-1 registration statement to the U.S. Securities and Exchange Commission (SEC) to launch a spot Chainlink ETF [2]. This move marks the first attempt in the U.S. to create a single-token crypto ETF, potentially increasing institutional interest in LINK. However, the success of this endeavor remains pending regulatory approval and investor response.

The Chainlink network continues to expand its partnerships, with one of the most notable being a strategic collaboration with Japan's SBI Group. The partnership, which includes initiatives in tokenized assets and stablecoin infrastructure, highlights Chainlink’s growing influence in institutional markets [3]. Despite these developments, the LINK price has experienced fluctuations, dropping more than 6% in the 24 hours following the announcement of the SBI partnership [4].

Market data as of September 1, 2025, shows that Chainlink’s circulating supply stands at 678 million LINK, or 68% of its maximum supply of 1 billion tokens. The token’s market cap is currently $16.31 billion, with a fully diluted valuation of $24.05 billion [5]. In terms of trading activity, LINK recorded a 24-hour volume of $1.68 billion, outperforming many of its peers in daily trading volume.

Chainlink's price trajectory has been influenced by broader market conditions, particularly during the week of August 20, 2025, when it surged 12% amid a larger crypto market rally triggered by dovish comments from Federal Reserve Chair Jerome Powell at the Jackson Hole symposium [6]. However, recent on-chain data and whale activity suggest that the token may face a key resistance level before it can extend its rally. The ability to break through this barrier could determine whether the current bullish momentum continues or reverses.

Analysts have also noted that the Chainlink Reserve, a newly established entity, has increased its holdings to 150,770 LINK following a $1 million purchase, signaling potential support for the token’s price [7]. This move aligns with broader efforts to stabilize and strengthen the Chainlink network, which is integral to its role as a decentralized oracle for smart contracts.

Source:

[1] Chainlink Price, LINK Price, Live Charts, and Marketcap (https://www.coinbase.com/price/chainlink)

[2] The Block, Aug 26, 2025 09:12PM (https://www.theblock.com)

[3] CoinDesk, Aug 25, 2025 05:28PM (https://www.coindesk.com)

[7] The Defiant, Aug 21, 2025 06:11PM (https://www.thedefiant.io)