Chainlink is a decentralized oracle network that provides real-world data to smart contracts that evaluate information and automatically execute when certain conditions are met on the blockchain. The last 3years have seen Chainlink integrate itself into the execution of over 300 projects.
LINK, the native token of the network, has witnessed a price rise of about 500%, amidst simultaneously witnessing price growth with every successful project integrated by Chainlink. However, the network is not slowing down its growth amidst recent success, and it has now announced it has impressive plans for 2021 that will help maximize blockchain innovation. It also plans to introduce oracles to non-blockchain entities for blockchain adoption in 2021.
Chainlink to work on security and scalability of the Oracle Network
The next year will witness the Chainlink team to bolster the network’s reliability, security, and scalability. The upgrade is supposedly assumed to help accommodate the billions of dollars in the Chainlink oracle network and, alongside that, provide developers a verified-data-rich environment where they can build and develop exciting blockchain solutions.
This year, the network reliability was tested when BitGo, the company operating wBTC (Wrapped Bitcoin), used Chainlink to audit its bitcoin reserves. This year, Chainlink acquired DECO – an improvement in the utilization of HTTPS/TLS for data transmission across the internet, from Cornell. The network is integrating DECO’s unique data security capabilities into its system. The longtime effect of this integration will increase the availability of private and premium data to the developers.
Chainlink upgrade might sell an insurance product in the Defi market
In a report by Nazarov, 2021 will see Chainlink helping more projects with verifiable proof of reserves. And this will help diversify the risk in the DeFi space as it will prove that there is collateral backed by valuable assets. Chainlink, which launched its verifiable randomness mechanism this year, is now working with insurance providers to utilize verifiable randomness to build innovative products.
The report by Nazarov explains that with the new system, an insurance product can be sold into the DeFi market. The user will, in turn, use the generated revenue from the insurance product in a smart contract. This smart contract can then be sold as collateral into the DeFi market. The level of support being outed by this upgrade will ensure that the Defi space is open to different types of collaterals. With the team also working on utilizing oracles to prevent flash loan attacks in DeFi space, the risks involved will be diversified.
The upgrade is facing hot pursuit from Non-blockchain enterprises
In the report by Nazarov, the Chainlink Oracle upgrade touted for 2021 is keenly followed by many blockchain and non-blockchain companies. Many traditional web companies have recently shown interest in utilizing the Chainlink oracles. These non-blockchain entities expect to capitalize on the network’s data security and reliability fully. Interestingly, according to Nazarov, this could be a new dimension of introducing these entities to the blockchain benefits.