Chainlink shows a rebound in price, DeFi selloff may not be over yet
Chainlink has been displaying signs of weakness over the past several days, but this pattern could be changing as the cryptocurrency bounces back today. This rally is likely motivated by the recent announcement regarding the launch of Ethereum 2.0, which is planned for December. The launch of ETH 2.0 marks a significant could shift in the altcoin market. Despite big losses over the past few months, it’s still a positive sign for a strong rebound, particularly with ETH surging over $400 this morning. So far many of the smaller altcoins are still struggling, but this may change over the coming weeks.
Why it matters: There was no doubt a bubble in DeFi assets that popped sometime around the end of the summer, but we can't know if the selling has reached its nadir. Given the turbulent economic backdrop, the contested US election, and lockdowns returning to the EU and UK, this may not be the time to go back into the riskier end of the crypto markets. Many of the high-flying DeFi tokens that were hot over the summer are still trading up on a year-to-date basis, which could mean more losses ahead. Buying at these levels could be done on a speculative basis, with the understanding that the markets may move much lower before they recover.
