Chainlink, the cryptocurrency infrastructure that remains undervalued according to Bitwise

One of the most important crypto assets could be completely overlooked by the market. Chainlink (LINK), which ranks eleventh in market capitalization with approximately $8.19 billion, is among the most conviction-driven investments of crypto asset manager Bitwise, although it rarely appears in the sector’s main conversations. The reason for this disconnect is not due to weak fundamentals but to the complexity and lack of widespread understanding of what it truly is and why it is undervalued.

Why the market underestimates a critical piece of infrastructure

The disconnect between Chainlink’s actual importance and its recognition in the market is particularly intriguing. Matt Hougan, Bitwise’s Chief Investment Officer, recently noted that Chainlink is “one of the least understood, most important, and possibly most undervalued crypto assets.” This assessment does not come from superficial analysis but from a deep understanding of how crypto infrastructure actually works.

The main reason Chainlink remains under the radar is its technical complexity. Unlike Bitcoin or Ethereum, which have clearly communicable value propositions, Chainlink plays a role that is difficult to explain in casual conversations. However, this apparent communication weakness conceals a fundamental strength: its indispensability within the ecosystem.

The true scope of Chainlink: beyond the data oracle

Typically, Chainlink is described as a decentralized data oracle that provides blockchains with real-world information, such as asset prices or event outcomes. While not incorrect, this description is deeply incomplete. Hougan illustrated this with a pertinent analogy: describing Chainlink as a data oracle is comparable to reducing Amazon to a mere bookstore.

Since its launch in 2017 by Sergey Nazarov and Steve Ellis, Chainlink has evolved into the essential connectivity layer that transforms isolated systems into networks capable of interacting with markets and real-world institutions. Without this connectivity, blockchains would be like powerful offline calculators: capable of performing complex operations but unable to access the necessary information to operate in real financial systems.

The connective tissue provided by Chainlink enables different blockchain ecosystems to communicate not only with external data but also with each other. This capability is fundamental for tokenization and decentralized financial systems to function in practice.

Silent institutional adoption: from JPMorgan to SWIFT

One of the most revealing aspects is how Chainlink has strategically integrated into the operations of elite financial institutions, both crypto-native and traditional. The level of adoption suggests institutional confidence that contrasts sharply with its low profile on social media and specialized media.

Institutions that have adopted Chainlink include SWIFT, DTCC, JPMorgan, Visa, Mastercard, Fidelity, Franklin Templeton, Euroclear, and Deutsche Börse, among others. This list is no coincidence: it represents the most critical players in the global financial infrastructure. For JPMorgan, Visa, and Mastercard, Chainlink provides the necessary infrastructure to connect traditional payment systems with new blockchain paradigms.

Tokenization and DeFi: the stage where Chainlink shines

The investment case for why Chainlink is undervalued becomes particularly clear when analyzing its role in emerging major institutional use cases.

Stablecoins, which rely on Chainlink to provide reliable price feeds, real-time reserve proofs, and secure cross-chain transfers, represent a primary use case. Tokenized stocks and bonds, another rapidly growing segment, use Chainlink to determine valuation, ensure regulatory compliance, and execute settlement logic.

Decentralized finance (DeFi) applications simply cannot operate without access to reliable external data. Prediction markets, on-chain derivatives, and virtually any application requiring verifiable information depend on decentralized oracles like Chainlink.

In each of these scenarios, Chainlink is not an interchangeable option but the trusted backbone that makes system operation possible. This quasi-monopoly position across multiple rapidly growing crypto infrastructure markets suggests that the economic value captured by LINK could be significantly below its true importance to the ecosystem.

Disproportionate growth potential in the next cycle

For investors optimistic about stablecoins, real asset tokenization, DeFi adoption, or broader cryptocurrency integration into financial systems, Chainlink is at the epicenter of all these narratives. It is not a secondary player in these developments but the fundamental facilitator.

As tokenization accelerates and institutional crypto adoption expands, Chainlink has the potential to benefit disproportionately. The market may be overlooking one of the most critical pieces of infrastructure precisely because its importance is so fundamental that it remains invisible.

Bitwise recognizes this potential and recently launched a listed product (ETP) for Chainlink, reflecting its conviction in the project. With LINK trading around $11.56 and a market cap of $8.19 billion, the market continues to evaluate an infrastructure that, although undervalued due to its complexity and low profile, is absolutely essential for the future of digital finance.

The question is not whether Chainlink has value but how much of that value is still to be recognized by the broader market.