Why does Chainlink remain an undervalued infrastructure in the crypto market

Matt Hougan, Director of Investments at Bitwise, argues that there is a significant gap between the actual importance of Chainlink and its valuation in the cryptocurrency market. Despite being the eleventh largest digital asset with a market capitalization close to $8.20 billion, Chainlink rarely occupies a prominent place in mainstream sector conversations. This disconnect does not reflect fundamental weaknesses but rather the inherent complexity of understanding its true role within the blockchain ecosystem.

“I believe it is one of the least understood, most important, and possibly most undervalued crypto assets,” Hougan stated in his recent analysis. The reason for this lack of understanding lies in an overly simplified characterization of what Chainlink actually does.

The true identity of Chainlink: much more than a data bridge

Most users describe Chainlink solely as middleware — or an intermediary — that supplies blockchains with real-world information, such as asset prices or external event outcomes. Hougan rejects this definition as deeply incomplete. To illustrate the limitation of this perspective, he uses a revealing analogy: “It’s like calling Amazon a bookstore.”

When Chainlink was launched in 2017 under the leadership of Sergey Nazarov and Steve Ellis, it was conceived with a more ambitious purpose: to serve as the connective layer that enables blockchains — systems that otherwise remain isolated — to interact with markets, institutions, and each other. Without this connectivity, Hougan explains, blockchains resemble powerful disconnected spreadsheets: capable of performing complex calculations but unable to access the information needed to operate in real financial systems.

The connective tissue supporting the blockchain economy

Chainlink’s potential becomes evident when analyzing its role in specific applications of institutional adoption. Stablecoins rely on Chainlink to obtain verifiable price sources and cryptographic evidence of reserves. Tokenized bonds and stocks use it for continuous valuation and automatic regulatory compliance. Decentralized finance applications, prediction markets, and on-chain derivatives cannot operate without a reliable source of external data.

This silent criticality has led to a deep integration of Chainlink into both native cryptocurrency financial institutions and large traditional corporations. The adoption ecosystem includes organizations such as SWIFT, DTCC, JPMorgan, Visa, Mastercard, Fidelity, Franklin Templeton, Euroclear, and Deutsche Börse. Their participation is not accidental: they recognize Chainlink as essential infrastructure for the next generation of digital financial markets.

Chainlink in the transition toward mass tokenization

For investors bullish on stablecoins, real asset tokenization, decentralized finance expansion, or genuine institutional adoption of cryptocurrencies, Chainlink is not a marginal component but the epicenter of this entire infrastructure. This central role positions the network with a considerable competitive advantage as these trends accelerate.

Unlike projects promising future functionality, Chainlink already operates as critical infrastructure. However, it remains undervalued because its importance is not evident in the typical superficial analysis of the crypto market. Bitwise recently recognized this opportunity by launching an exchange-traded product (ETP) dedicated to Chainlink, signaling confidence in its long-term potential.

At the time of this analysis, LINK was trading at $11.58, reflecting a market that has not yet fully priced in the criticality of this infrastructure in the evolution of the blockchain ecosystem toward truly integrated and institutional financial systems.