Review on Chainlink by Fanuel PORPORTY
ChainLink, an interesting project that can make the link between off-chain information and on-chain information by offering users easy access to oracles while ensuring their reliability.
ChainLink is the oldest of the projects to provide an oracle-like service. When Ethereum was created in 2015, it revolutionized what blockchain could offer as a solution for companies. Before that, Bitcoin-type cryptocurrencies consisted mainly only of an alternative exchange of value allowing to remove intermediaries from transactions. With his smart contracts, the founder of Ethereum Vitalik Buterin has opened a Pandora's box which offers many applications for blockchain technology. But the big problem with smart contracts is that they can only manage the information present on the blockchain. This therefore greatly limits the interest of these smart contracts because they cannot obtain certain information directly, such as the temperature on a given date, the winner of a sporting event, the result of the vote on a new law, etc.
And that's where ChainLink and its Oracle service come in. With ChainLink, users of smart contracts can use the network of oracles set up by the company in order to retrieve information known as "off-chain", that is to say from outside the network. The main purpose of ChainLink is to connect the on-chain world (on the blockchain) and the off-chain world (information that is not on the blockchain). To achieve its objective, the project will be composed of two infrastructures: an on-chain and another off-chain.
The first component of ChainLink is on-chain and consists of a smart contract deployed on the Ethereum blockchain. It is an "oracle contract", which will process requests from users who want to obtain off-chain information. When a user wants to obtain off-chain information, he will submit a request to the ChainLink network via a "user contract", and the blockchain will process this request through his own "oracle contract". This type of smart contract is responsible for matching requests with the appropriate oracles.
The second component of ChainLink is off-chain and consists of "oracle nodes", which are connected to the Ethereum network. For the moment, ChainLink operate only on the Ethereum network, but in the future it will be possible to operate on other networks, the project being intended to be agnostic as to the blockchain used.
Unlike other oracles which are centralized, the ChainLink protocol is completely decentralized. This will solve the problem that centralized oracles who may provide inaccurate data may encounter. For example, if a report on financial results is to be received, this oracle could alter this data if it had a bad intention or was corrupted to provide false data. To address this concern, ChainLink implements what it calls distributed sources and oracles. If an oracle wants to gain a good reputation, it can extract its data from several sources. In addition, when a "user contract" makes a request to the network, this request is subcontracted by several "oracles nodes" off-chain.
Thus, each oracle will seek its information in different places. The "oracle contract" will then compile these different data and give an average value if the information is not consistent. The advantage of using such a system is that the different oracles have no interest in falsifying their information. ChainLink will indeed be able to detect those who give false information and it can penalize them by not paying them or by degrading their reputation on the network.
Pros
- The project aims to facilitate the acquisition and integration of off-chain information in a simple and efficient way.
- Possibility of inserting the criteria of our choice to choose the oracles.
- Oracles receive ratings reflecting their reputation, which will dissuade them from transmitting false information for fear of no longer being chosen and therefore, of no longer receiving a LINK token as payment.
- Weighting of information provided by oracles when they are not completely identical.
- The development team is perfectly suited to setting up such a project.
- The project is agnostic about the blockchain used. Ultimately, its Oracle system will be able to work with blockchains other than Ethereum.
- Ability to add "adapters" to improve the efficiency of certain processes.
Cons
- Very little marketing around the project.
- Only 35% of the tokens were sold to the public.
- The development team does not communicate a lot about the progress of the project.
- Competitors have appeared in the market and appear to be achieving their targets much more quickly.
