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What is Chainlink?

Dec 21, 2019 | Cognition, Cryptocurrency

There are hundreds of crypto and blockchain ecosystems capable of competing with one another. Chainlink seems to have a significant advantage over others. Its core business model is very different from most other projects.

The Core Chainlink Concept

Blockchain technology needs to be utilized to its full potential. How that will be done, remains subject to significant debate. Chainlink wants to provide a network for reliable tamper-proof inputs and outputs. 

This allows the developers to support complex smart contracts on any blockchain.

Under the hood, it is possible to connect smart contacts to external data sources. This can be done in different ways, including the use of APIs.  

For those who prefer utilizing Chainlink to payments, that option is there as well. Payments can be sent from a contract to payment networks or bank accounts without friction. 

Technical Details to Take Note of

By default, smart contracts are somewhat limited as to what type of information can interact with. Chainlink aims to remove the barriers altogether. Relying on multiple inputs to improve and guarantee contractual performance is crucial.

Additionally, using multiple outputs to affect outside systems is equally crucial. By acting as a secure middleware to bridge the gap between code and real world data, a lot of potential use cases can be unlocked.

Rather than relying on a single node, Chainlink utilizes a decentralized oracle network. This approach offers higher levels of security and removes any central point of failure from the equation. Multiple Chainlinks can evaluate the same data to ensure everything is in order. 

It is crucial to note that this project runs on top of the Ethereum mainnet. Ethereum’s ecosystem is perhaps the largest when it comes to overall smart contract development. Extending those projects’ functionality by providing them with reliable data sources is a big step forward. 

Blockchain Agnosticism is key

Rather than focusing on its own chain, Chainlink can link to any blockchain out there. Giving users the options to sell data feeds and APIs to smart contracts directly is a crucial development. All of the major blockchain networks are supported, giving providers ample choice.

All it takes to do so is running a Chainlink node. Once a node receives a request from a contract, the request will be fulfilled through the existing APIs. Any developer can sell their API if they desire to do so.

For enterprises, partnering with this project to offer existing APIs for purchase is a potential new revenue stream. As millions of smart contracts exist already, demand for reliable data sources will only grow. The time for monetization is now.

Tapping the Asian Market

It has proven crucial to enter the Asian market as a blockchain service provider For Chainlink, that venture appears to be going well. Contacts have been formed in China, Japan, Singapore, and South Korea. 

By actively adding data providers such as CoinGecko and Binance, the company keeps evolving rapidly. Earlier this year, the team held a presentation at  the Wanxiang Blockchain Conference to cater to the Chinese community. 

Website: https://chain.link/

Images courtesy of their respective sources.

Fintoism is not providing financial or investment advice. All content published on this platform is for entertainment and educational purposes only.

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<a href="https://fintoism.com/author/oglock/" target="_self">JP Buntinx</a>

JP Buntinx

JP Buntinx is passionate about cryptocurrencies, fintech, blockchain, and finance. He currently resides in Belgium.

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