Categories: Crypto Currencies

What is Chainlink (LINK) Cryptocurrency? Why Is It Unique?

What is Chainlink cryptocurrency? (LINK)

Chainlink is a decentralized network of oracles that focuses on providing real-time data to smart contracts on the blockchain. It promotes its LINK token, it is widely used to pay for services on the network.

What makes Сhainlink unique?

Chainlink is a unique cryptocurrency and works as a kind of intermediary in the decentralized network. Unlike other blockchain projects, it focuses on creating public smart contracts, surpassing the crypto bubble.

In essence, it is a decentralized network of nodes that provide data and information from sources outside the blockchain to smart contracts inside the blockchain using oracles. It achieves this by sending the request as an “event” and creating the corresponding smart contract via the Chainlink protocol.

All Chainlink node operators use LINK to participate in the network, and node operators must bring LINK to Chainlink to demonstrate their dedication to the network and to stimulate good service. As a result, a closed economy is created and liquidity is guaranteed in the Chainlink network.

How the system works?

The network consists of both on-chain and off-chain chains. The on-chain component uses Oracle contracts to process user requests for data. Chainlink contracts consist of three elements:

  • Recording a reputation contract and reviewing the performance of the Oracle Service Provider;
  • an order fulfillment contract, which is required to register user bids, collect bids from Oracle suppliers, and select them in accordance with reputation contracts;
  • Chainlink aggregation contract, which is used to collect responses from oracle providers and calculate the response according to this data.

Future of Chainlink (LINK)

Many people are wondering what the future of Chainlink cryptocurrency looks like, given that it is now in demand for the development of the Ethereum infrastructure. The Chainlink decentralized oracle project has also been one of the big winners in the cryptoeconomics of 2019 and 2020, especially in terms of network adoption, partnerships and price action.

Chainlink project was able to occupy an unbeatable niche. Decentralized contract oracles enhance the security of DeFi protocols. For example, they determine the prices of cryptocurrencies when issuing loans. The bZx example is quite indicative: in February 2020, a hacker found a way to withdraw almost $ 1 million from bZx due to price manipulations and the fact that bZx only used Kyber oracle. After this incident, bZx switched to Chainlink to prevent such incidents in the future.

The LINK cryptocurrency is expected to rise in value due to the great potential of the Chainlink project and the apparent success of this smart contract network. Chainlink has already chosen the following protocols: Loopring, Ampleforth, Polkadot, etc. The list is growing almost day by day.

According to experts, the price of Chainlink will continue to rise in the coming years, possibly surpassing the $ 40 mark by 2023. If LINK maintains its relevance in the industry and manages to outperform its competitors, it could be worth 10 to 100 times its all-time high. Perhaps LINK will remain in the crypto space for a long time.

Real user traction is another critical factor in Chainlink’s success. This is what most holders call “acceptance”. Chainlink has built a wide and passionate community that is educated and patient, and this is sure to pay off in the long run.

Should you invest in Chainlink cryptocurrency?

Chainlink is worth investing in and trading, even though 2019 may not seem like a busy year for Chainlink. However, established partnerships, including various system integrations with Celer, Hedera Hashgraph, Synthetix, Zilliqa, have certainly strengthened Chainlink.

Chainlink remains one of the few networks with widespread use in the real world. This factor adds tremendous value to its value, further underpinned by the multitude of actions by the Chainlink team in an attempt to create new partnerships.

As Chainlink steadily grows in value and its team continues to popularize its unique business model, as well as its focus on the oracle system and associated cryptocurrency, LINK is just taking off into space.

 

Olivia Chloe

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