Chainlink Surges 57.6% as Daily Activity Rises but Retention Dips to 17%

Chainlink (LINK) has surged by 57.6% over the past month, outperforming many of its peers in the cryptocurrency market [1]. This significant price movement has coincided with a sharp rise in the number of daily active addresses on the Chainlink network, reflecting a notable increase in user engagement [1]. However, despite this positive development, data suggests a potential long-term concern: the network’s activity retention rate has been declining, currently sitting at 17%, down from 24.5% in April [1].

The growing daily active addresses metric indicates that Chainlink is attracting more new users, which is typically a bullish sign for the network’s adoption and utility. Yet, the drop in the retention rate implies that a significant portion of these users may not be returning to the platform consistently [1]. This divergence between rising activity and falling retention could be a warning sign of speculative behavior rather than sustained demand, particularly if the new users are not converting into long-term participants.

Historically, during the first few months of 2025, Chainlink experienced a slower but more consistent growth in user base, with rising retention despite lower daily activity. This period was followed by a price increase, suggesting a potential correlation between stable, long-term user engagement and price appreciation [1]. The current situation, characterized by high volatility and rapid activity surges, appears to contrast with that pattern, raising questions about the sustainability of the recent price gains.

Market sentiment remains largely bullish in the short term, supported by increasing Open Interest and a rising spot CVD, which indicates growing demand for LINK [1]. Additionally, the positive funding rate reflects that traders are predominantly leaning into long positions, betting on further upside. However, analysts warn that if the retention rate continues to fall while activity remains high, the market may be setting itself up for a correction once speculative enthusiasm wanes [1].

Chainlink’s price trajectory is also influenced by broader market conditions. For example, Bitcoin has seen a rangebound performance in recent weeks, fluctuating between $112k and $124.5k. The performance of LINK, while strong, is still partly dependent on the broader macroeconomic environment and the movements of major cryptocurrencies like ETH [1]. If Bitcoin and Ethereum struggle to gain momentum, it could impact altcoins like Chainlink, even if the underlying network shows signs of adoption.

In the coming weeks, the focus will likely shift to whether the Chainlink network can improve its user retention and convert short-term activity into long-term engagement. If successful, the network may continue to see price appreciation and broader adoption. If not, the recent gains could be at risk of reversing once the speculative fervor subsides. Investors are being encouraged to closely monitor both on-chain metrics and price action to gauge the project’s true health.

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[1] Chainlink rises 57.6% in a month, but THIS falling rate points to…

(https://ambcrypto.com/chainlink-rises-57-6-in-a-month-but-this-falling-rate-points-to/)