LINK Surges 20% in 24 hours Following the Launch of Chainlink’s Cross-Chain Interoperability Protocol During EthCC
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Chainlink’s LINK token has surged more than 19% in the last 24 hours.
The price action was driven by the launch of the blockchain oracle network’s Cross-Chain Interoperability Protocol (CCIP) during EthCC.
Developers on the Ethereum, Optimism, Polygon, and Avalanche blockchains can now build cross-chain apps and services on top of CCIP.
Chainlink’s native token, LINK, surged 20% in 24 hours, going from $6.81 to $8.17, before pulling back to $8.09 as of this writing, according to CoinMarketCap.
LINK’s trading volume has also increased by over 300% in the last 24 hours, with 53% of LINK supply currently circulating in the market.
The investor interest in the token is believed to be driven by Chainlink’s launch of its Cross-Chain Interoperability Protocol (CCIP) on the Ethereum, Optimism, Polygon, and Avalanche blockchains during EthCC.
On Thursday, CCIP went live on several testnets, giving developers the opportunity to start building cross-chain smart contracts. Investors are bullish on Chainlink’s potential as it aims to attract traditional financial institutions to use the CCIP for their blockchain needs.
Earlier this month, Swift, the provider of secure financial messaging services, announced an initial proof of concept using CCIP to enable secure messaging and token transfers between large financial institutions and multiple blockchains.
Swift, alongside more than a dozen top financial institutions, including Australia and New Zealand Banking Group Limited (ANZ), BNP Paribas, BNY Mellon, Citi, Clearstream, Euroclear, Lloyds Banking Group, SIX Digital Exchange (SDX), and the Depository Trust and Clearing Corporation (DTCC), will explore how they can transact with various public and private blockchains through Swift’s PKI and CCIP.
On the final day of EthCC today, Chainlink co-founder Sergey Nazarov said that the CCIP will “eventually merge institutional/bank chains and the existing public blockchain DeFi ecosystem into a single on-chain financial system that secures the world’s value on the Internet of Contracts.”
“There’s tens of trillions of liquid value that can flow into the blockchain ecosystem and that liquid value is just now – like right about now – getting put on a bank chain,”Nazarov said.
“So that’s a real opportunity and something we want to facilitate in a secure and reliable way to show the world that they are better off using the blockchain financial system.”
What is CCIP?
In a blog post, Chainlink Labs Chief Product Officer Kemal El Moujahid explained that CCIP is an interoperability protocol for building cross-chain applications and services. Developers are given the flexibility to create their cross-chain solutions on CCIP through Arbitrary Messaging, allowing them to include additional custom messages within a transaction that may not necessarily be related to asset transfers.
Additionally, CCIP offers Simplified Token Transfers, allowing protocols to quickly transfer tokens across chains using audited token pool contracts they control, without the need for custom code. This saves considerable development time compared to building the same functionality from scratch.
Other use cases for CCIP include:
- Cross-chain collateral: Lending applications that allow users to deposit collateral on one blockchain and borrow assets on another.
- Cross-chain liquid staking tokens: Bridge liquid staking tokens across multiple blockchains to increase their utilization in DeFi apps on other chains.
- Cross-chain NFTs: Developers can enable users to mint an NFT on a source blockchain and receive it on a destination blockchain.
- Cross-chain account abstraction: Build smart contract wallets with native CCIP capabilities to enable users to approve transactions on any chain using a single wallet.
- Cross-chain gaming: Create blockchain-agnostic gaming experiences that enable players to store high-value items on more secure blockchains while playing on more scalable blockchains.
- Cross-chain data storage and computation: Employ data storage solutions that enable users to store arbitrary data on a destination chain and execute computations on it using a transaction on a source chain.
DeFi protocol, Synthetic, is using CCIP to burn and mint tokens across chains while Aave is integrating CCIP into its protocol to future-proof its cross-chain governance system.
While LINK’s current price is still more than 80% below its all-time high of $52 in May 2021, popular crypto analyst Rekt Capital, who has over 342,000 followers on Twitter, predicts that LINK will soon touch its resistance of $8.30 as it gears up for a bullish breakout.
$LINK is soon going to touch the red diagonal resistance— Rekt Capital (@rektcapital) July 20, 2023
A Monthly Close above the black Range High resistance would be a positive sign towards a range breakout
But a Monthly Close above this red diagonal would be even better#LINK #Crypto #Chainlink https://t.co/iAArtkkimC pic.twitter.com/70OPwr5UK4
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