Chainlink announces the establishment of a reserve for the virtual currency LINK, having already purchased 150 million yen worth.

## Establishment of LINK Reserves

The Chainlink (LINK) project, which develops blockchain infrastructure, announced on the 7th the establishment of a strategic reserve for the cryptocurrency (virtual currency) LINK.

The purpose of the foundation is to support the long-term growth and sustainability of the Chainlink network. It states that LINK will be purchased using on-chain service fees and off-chain revenue from major companies adopting Chainlink.

In this announcement, it was explained that the demand for Chainlink is already generating revenue on the scale of hundreds of millions of dollars (several tens of billions of yen). Furthermore, it was stated that much of this revenue is generated from large companies that make off-chain payments to access the Chainlink platform.

Chainlink, which provides multiple products such as Oracles, has a wide range of use cases including DeFi (decentralized finance) and asset tokenization. It is also highly reliable, and adoption is progressing among major companies and financial institutions.

What is an oracle

An oracle in blockchain refers to the functionality or service that retrieves off-chain data. A blockchain, on its own, cannot access information from outside the network.

The announcement explained that, as the initial stage of the establishment of the reserve fund, they have already purchased LINK worth 1 million dollars (approximately 150 million yen). It stated that more revenue will be converted into LINK, and over a few months, the amount of the reserve fund will gradually increase. It also explained that there are no plans to withdraw the reserve fund for several years.

In this announcement, Chainlink co-founder Sergey Nazarov commented as follows.

The establishment of reserves is a very important evolution in Chainlink.

This reserve provides a clear answer on how off-chain revenue and large-scale institutional adoption contribute to the growth, security, and sustainability of Chainlink.

In addition, information about the reserve fund is published on the website. The price of LINK is trending above 18 dollars at the time of writing this article, having risen more than 10% compared to the previous day.

Utilize Payment Abstraction

It was explained that the reserve for LINK utilizes the infrastructure of "Payment Abstraction," which was officially announced for launch on the mainnet this March.

This infrastructure is developed to abstract cross-chain payments. It is an infrastructure that allows users to pay Chainlink fees with currencies other than LINK, such as stablecoins.

The currency paid by users is programmed to be exchanged for LINK through Chainlink services and DEX (decentralized exchanges).