Chainlink is infrastructure for connecting smart contracts to data and services through oracle networks. Its original whitepaper, by Steve Ellis, Ari Juels, and Sergey Nazarov, described a system combining offchain node software with onchain aggregation. Chainlink announced its Ethereum mainnet launch on 30 May 2019.12

History and designReport an error

The 2017 paper proposed distributing oracle work across nodes and sources to reduce dependence on a single provider. It distinguished the blockchain's agreement about execution from the separate task of obtaining external information. The 2019 launch announcement applied this model on Ethereum.12

Chainlink's Data Feeds publish reports such as asset prices, reserve information, and interest rates. Its documentation describes aggregation from multiple sources and use in collateral valuation and settlement. The specific feed determines what is measured; a contract must select and interpret the relevant report.3

Offchain reportingReport an error

With Offchain Reporting, oracle nodes exchange observations over a peer-to-peer network and sign an aggregated report. A node submits the report to an onchain contract, which verifies signatures from the required quorum. This reduces the number of blockchain transactions compared with having every node publish its observation separately. Other nodes can attempt transmission if the scheduled sender fails.4

Chainlink documents LINK as the payment and compensation token for its services. Its payment-abstraction mechanism can accept other forms of payment and convert them into LINK. The token extends ERC-20 with ERC-677 functionality, including a data payload accompanying a transfer. Token ownership should be distinguished from the operation of a particular oracle network.5

Risks and integrationReport an error

Chainlink's feed-selection guidance says all feeds have inherent risks. Thin trading, concentration on one venue, congestion, and changes to an asset's backing can affect the usefulness of a reported price. Developers remain responsible for choosing a suitable source and configuring their application's risk parameters. Aggregation does not remove the need for those decisions.6

TimelineReport an error

Date Event
2017-09-04 First Chainlink whitepaper dated1
2019-05-30 Ethereum mainnet launch announced2

See alsoReport an error

ReferencesReport an error

  1. ^ a b c Ellis, S., Juels, A. and Nazarov, S. (4 September 2017). ChainLink: a decentralized oracle network. https://research.chain.link/whitepaper-v1.pdf 

  2. ^ a b c Nazarov, S. (30 May 2019). Chainlink: connected consensus on Ethereum. https://chain.link/blog/chainlink-connected-consensus-on-ethereum 

  3. ^ a b Chainlink. Data Feeds. https://docs.chain.link/data-feeds 

  4. ^ Chainlink. Offchain Reporting. https://docs.chain.link/architecture-overview/off-chain-reporting 

  5. ^ a b Chainlink. LINK token contracts. https://docs.chain.link/resources/link-token-contracts 

  6. ^ Chainlink. Selecting quality data feeds. https://docs.chain.link/data-feeds/selecting-data-feeds