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Chainlink: Connecting Smart Contracts to the Outside World

Chainlink: Connecting Smart Contracts to the Outside World
Source:investingcube.com

Ethereum smart contract is one unique feature that has caught the eyes of many in the cryptocurrency space. In fact, many investors and traders alike call it the next digital lawyer. It has created a more transparent system in building trust and securing funds, serving as a bridge between two parties. Many crypto fans described the Ethereum smart contract as a success feature that will change the blockchain industry.

A smart contract contains the “terms” of a blockchain transaction between a buyer and a seller, as well as the capabilities to execute those terms. However, in order for smart contracts to include outside data from the world, such as weather, market data, sports data, etc. …, the contract needs a third-party service called an oracle. The industry standard blockchain oracle is Chainlink.

If you have been hearing about Chainlink and its native token, LINK, and don’t know what they are, this post will help. It will provide you with all the information you need about Chainlink and how it could revolutionize the world by connecting smart contracts to the outside world.

Chainlink

Source:cryptosec.info

Created in 2014, Chainlink is a decentralized and open-source oracle network that connects to any blockchain with seamless API connections. Their nodes connect to trusted data with cryptographic proofs that make their network tamper-proof. The blockchain-standard oracle is used with smart contracts that secure billions of dollars of value for blockchain projects.

Chainlink oracle network greatly expands the value of smart contracts and is used to create cutting-edge, modern blockchain applications.

What Problem Does Chainlink Solve?

Source:medium

Chainlink attempts to solve one of the biggest problems facing the blockchain sector, how to communicate information to and from the blockchain. Sometimes, a smart contract wants information about the real world, like a basketball game score, account balances, or the price of Ethereum. In this case, smart contracts need to deal with external data, known as off-chain data that does not already reside on the blockchain, and this data needs to be in the same format as on-chain data.

While traditional oracles can help accomplish this task, bringing off-chain data to on-chain, the centralized nature of the oracles can diminish the benefits of a blockchain as they can be faulty and alterable. If an oracle becomes corrupted or compromised, it can put the entire network at risk. That is where Chainlink comes in.

Chainlink aims to provide tamper-proof inputs and outputs for complex smart contracts and connect them to real-world events and data. Chainlink has gained a fair amount of popularity in the blockchain community because of its effectiveness and potentials.

How Does Chainlink Work?

Source:emailanalytics.com

Chainlink is an oracle network that leverages the same technologies found in traditional blockchains to make sure the nodes in operations are functioning properly and their data accurate. In the Chainlink ecosystem, the process starts when a user puts out a request Requesting Contract for information. The information will then be listed as a blockchain event within the network, which hence creates a set of three other contracts that altogether first verify an oracle’s authenticity to utilize the best oracle, then deliver the nodes needed to complete the request, and finally to reconcile incorrect data.

Benefits of Chainlink

Major benefits have been associated with the introduction of Chainlink to the network. Oracles are important to network expansion, and they have remained the core of the most exciting development in the sector. Chainlink makes it possible for the firm to continue to leverage the potentials of oracles but in a trustless manner.

With Chainlink, users can be assured that the data they receive is not incorrect, corrupt, and are timely. In the case of a single node failure, the system automatically replaces it with a higher ranking alternative.

Chainlink also provides an easy user interface and design that meet users’ needs. The architectural design of the system is intuitive, allowing easy passage of information to users. The design is divided into two: on-chain and off-chain design for the sake of simplicity.

The scalability nature of Chainlink is also amazing. That means it can handle multiple information in its network at the same time, without affecting speed and costs.

Chainlink’s 2020 Partnership

Source:cointelegraph.com

After Chainlink’s partnership with Google in 2019, which was considered the firm’s most significant partnership to date, the firm has made some more interesting partnership in 2020 that has proved Chainlink to be a good win for investors. Some of these partnerships include:

  • Partnership with Digitex Futures in May 2020
  • Partnership with Korean Tech Giant Kakao in May 2020
  • Partnership with Tezos, Ethereum rival in April 2020
  • Partnership with CasperLabs in April 2020
  • Partnership with Polkadot, the first non-Ethereum blockchain to integrate Chainlink in February 2020
  • Partnership with Hdac Technology in March 2020
  • Partnership with Baseline Protocol in March 2020

LINK: Chainlink’s Native Token

Source:laptrinhx.com

The Chainlink network is built on independent node operators, making it decentralized Oracle technology, unlike other oracle designs that depend on a centralized entity as a gateway. The node operators have jobs specific to each node, helping to execute jobs coordinated by the on-chain oracle contracts. The node operators are hence rewarded with the LINK tokens for their honest, high-quality work.

The LINK is the native token that fuels the Chainlink network. In the last few months, LINK’s price has been on a steady upward climb. In May, the token increase in price by 8.5% and it is presently valued at $21.39.

If anyone is willing to invest in Chainlink, this is just the right time. You can buy your LINK coin from AnyCoin Direct. The platform makes buying Chainlink super easy and fast. So you definitely won’t be having any issues taking your first step to greatness.

How to Store Chainlink (LINK)

Source:alphawallet.com

Whether you intend to buy and hodl or trade your LINK, you will need to get a secure digital wallet to store them. Leaving a significant amount of LINK on the exchange wallet is not advisable. You can use a reliable mobile Dapp like JAXX to keep your LINK token safe and away from the hungry eyes of exchange hackers.

However, if you intend to hodl the crypto for a long time, you should get a hardware wallet to store them. Ledger Nano S or Ledger Nano X are good options, and they both support Chainlink (LINK).