A picture is worth a thousand words. That picture tells a story. A story of how whoever put that master link on didn't do a very good job. What probably happened is that they didn't put the side plate on the master link correctly (not close enough). The "O" ring probably got damaged by being caught between the side plate and the roller, possibly even pinched during installation. The "O" ring is probably missing on that side (you can look at it from the rear and see if you see the "O" ring), which allowed all the lubricant to come out. Then it's metal to metal and it wears quickly. Just looking at the chain, you can see the gap that is between upper most gold side plate and the next gold side plate compared to the gap between the master link side plate and the gold side plates that are next to it. I took the liberty of editing your photo so you could see what I was referring to. The entire chain is probably not bad, but clearly a chain is only as strong as the weakest link, and that couldn't be more true than here.



In this photo you can see the "O" rings inbetween the the side plates. The upper is of an older standard "O" ring chain, and the lower is the newer "X" style of "O" ring. You can see a line or grove along its circumference.

 

^^ Yep, what he said.

 

Oh yea, don't ride it like that, it's dangerous.