The blockchain middleware technology Chainlink, which makes use of the LINK cryptocurrency token, is fascinating. The LINK token exists on the Ethereum blockchain as a sub-token. A decentralized network of oracles called Chainlink is created to enable communication between smart contracts and the outside world. Chainlink and its network of Oracles are inseparably linked. Oracles are data feeds from outside systems that deliver crucial data to blockchains that smart contracts may need to function under certain circumstances. Oracles are third-party services with a centralized single point of control that are not part of the blockchain consensus mechanism, raising the question of whether their data is reliable. Due to the automated nature of smart contracts, it is crucial that the data they receive be reliable and correct to guarantee appropriate smart contract operation.
Aim
With Chainlink, a safe network of decentralized oracles will be developed for use by smart contracts. It removes any single point of failure and preserves the total value of smart contracts that rely on external data by requesting data from many Oracles before triggering a result.
The benefits
Chainlink has two primary benefits over its competitors who also use oracles, and these are its distributed sources and distributed oracles. While Chainlink is a network of decentralized oracles, the majority of oracles are centralized. The veracity of the data is in doubt since oracles are traditionally third-party services provided by centralized institutions that are not subject to blockchain consensus methods. With only one oracle serving as the source, inaccurate data might be transferred to the blockchain, causing smart contracts to carry out the wrong operations. With just one oracle serving as the source, inaccurate data could also be altered by individuals with malevolent intent.
Various sources and oracles
Chainlink employs a system of distributed oracles and sources to address this security issue. The oracle can use data from a variety of sources to increase its credibility as a source if it wants to be taken seriously. In addition, the Chainlink network contracts out a user’s contract request to some oracles, who may get their knowledge from different sources. For instance, when a user submits a contract request, the request is distributed among several oracles rather than being directed to a single centralized source. Each of these oracles then obtains data from different sources, sometimes with overlaps, to ensure that the contractor receives a balanced aggregate of information and can be trusted. Because the data is aggregated and compared to the rest of the data that has been collected, this two-part method assures oracles are truthful. As a result, Chainlink contributes to ensuring that smart contracts are executed properly and without malice. Along with this technology, Chainlink has alliances with illustrious organizations like SWIFT and Google Cloud, demonstrating its acceptability and usefulness for centralized organizations while staying decentralized.
The drawbacks
Chainlink does not have any overt drawbacks, but there are more covert drawbacks for individuals wishing to invest in Chainlink. The first of these nuances is that many people believe the LINK token to be relatively useless to the network because it is solely used to compensate oracle operators. Many people believe this could have been accomplished with a less project-specific cryptocurrency. Because the value of LINK is directly proportional to network usage, operators are unlikely to run oracles without a high volume of traffic to be fairly compensated. The second nuance is Chainlink’s lack of publicity and outreach. As previously said, Chainlink neglected to promote and communicate after the Initial Coin Offering and even before it. This prompted many people to think they had been duped. Thankfully, they are now much more active on several social networking sites. They also have a dedicated following that is often ironically referred to as the Link Marines.
