What is Chainlink and why it is important for crypto-ecosystem?
12 Jun 2021Why
Blockchain’s inability to fetch reliable information from the real world
● Huge vulnerability in decentralized applications when Blockchain wants to take advantage of off-chain data
● Origins of data are also the points where data can be manipulated, compromised, or simply falsified
● Chainlink started on Ethereum but it’s also available on Polkadot, Hyperledger, etc…
Chainlink
Decentralized network of nodes that provide data and information from off-blockchain sources to on-blockchain smart contracts via oracles. LINK is built on Ethereum in accordance with the ERC-20 standard for tokens
❏ Sep 2017 – Chainlink raises $32 million in an ICO creating 1 billion LINK tokens
❏ Nov 2018 – Chainlink acquires TownCrier
❏ May 2019 – Chainlink is launched on Ethereum mainnet
❏ May 2021 – Chainlink 2.0 whitepaper
The Chainlink’s oracle
Oracle – Middleware that acts as an intermediary, translating data from the real world to smart contracts on the blockchain and back again
Chainlink – Decentralized network of nodes that provide data and information from off-blockchain sources to on-blockchain smart contracts via oracles
🥇 Market standard for decentralized oracles
✅ Enhance and extend the capabilities of smart contracts on a target blockchain through functions that are not available natively
✅ To minimize the potential failure of oracles: Distribution of data sources, Distribution of oracles and Use of trusted hardware
✅ The Chainlink Reputation Contract
Chainlink 2.0
Chainlink 2.0: Next Steps in the Evolution of Decentralized Oracle Networks
Oracle networks go far beyond delivering highly validated data, they provide the various decentralized
services that are combined with smart contracts to create real world outcomes. These hybrid smart
contracts are already redefining our industry as DeFi.
🔥 Hybrid Smart Contracts that are seamlessly connected to all necessary off-chain resources, while retaining increased levels of privacy and being secured
🔥 New “architecture” enables more advanced off-chain computation
🔥 Increase number of services since ecosystem is more flexible and enhance its capabilities. Chainlink is the future of DeFi
Glossary
ERC-20: technical standard used to issue and implement tokens on the Ethereum blockchain. It makes easier for developers to predict with more accuracy the interaction between different tokens and applications
Faucet: website that distributes small amounts of crypto
ICO: An Initial coin offering occurs when company looking to raise money to create a new coin, app, or service launches an ICO as a way to raise funds. Similar to an IPO
Middleware: software that acts as a bridge between an operating system or database and applications, especially on a network
Off-chain: Transactions which agree to happen outside the blockchain
On-chain: normally refer to as blockchain transactions which happens inside the blockchain
Additional Information
Top Oracles Tokens by Market Capitalization