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Chainlink and Tezos rally as Ropsten merger fails to lift Ether

Decentralized oracle network Chainlink’s LINK token and open-source blockchain Tezos’ XTZ coin traded higher, ignoring lackluster action in major cryptocurrencies.

As of 9:37 a.m. ET, LINK was trading at $9.7, topping the list of the best performing cryptocurrencies in the past 24 hours with a 6.7% rise, according to data from Forbes. Meanwhile, XTZ took second place with a 6% rise, followed by names like Terra Luna Classic (LUC) and VeChain’s VET token. The losing side included Dfinity Foundation’s Internet Computer Token (ICP), down 6%, and Decred’s DCR and Huobi token, down 4% each. Bitcoin, the leading cryptocurrency by market value, traded at around $30,000.

On Wednesday, Chainlink, which provides blockchain networks with price feed data collected from sources both on and off the blockchain, unveiled an updated schedule for the implementation of the staking program first announced in April 2021 and revisited in January this year. The announcement likely galvanized interest in cryptocurrency. Prices have risen more than 20% since then, as shown in the chart provided by TradingView.

Staking is expected to bring a new layer of security and decentralize the oracle network by providing network participants with rewards and penalties to incentivize the proper functioning of the network. Staking, the passive investing version of a crypto market, refers to depositing coins into a network to bolster its security in exchange for rewards.

Chainlink will reward stakers’ native token issuances from LINK token supply and a portion of user-paid services. Oracle plans to implement staking called v0.1 later this year with an initial pool size of 25 million LINK tokens.

Chainlink is the largest crypto oracle with a market value of $4.36 billion, according to Coingecko. Several DeFi heavyweights like Compound, AAVE, Synthetix and Nexus Mutual have integrated Chainlink price feeds on their platforms. The oracle price feeds have recently gone live on the Solana mainnet.

Ropsten fusion fails to lift ether

Ether, the native blockchain token of Ethereum, was trading sideways at around $1,800, with buyers remaining on the close despite the successful merger of Ethereum’s oldest testnet’s Ropsten proof-of-work chain with the proof-of-stake tag string.

The purpose of the Ropsten merges, which happened on Wednesday, was to prepare the Ethereum mainnet for a similar merger, which is expected to take place later this year. The mainnet merger, once completed, should have bullish implications for the price of Ether.

“We can sum up the positive case as follows: (a) reduction in issuance to miners, therefore less structural selling pressure + (b) a substantial increase in real return from staking to 7-10%,” said Ilan Solot, partner of Tagus Capital. Multi-Strategy Fund, said in an email. “But here’s the part that I think is less discussed by commentators: the merger could equate to a 300-600 basis point Fed hike for the Ethereum economy.”

However, the upgrade failed to attract buyers to the ether market, leaving the cryptocurrency stuck in its recent triangular consolidation.

Cautiousness ahead of Friday’s U.S. inflation report, which may warrant a quicker tightening of liquidity by the Federal Reserve, likely prevented traders from making big commitments in bitcoin and ether.

The Consumer Price Index due out Friday at 8:30 a.m. ET is expected to show the cost of living in the world’s largest economy rose 0.7% month-over-month in May – a big jump from April’s growth rate of 0.3%.