{"id":4280,"date":"2020-10-23T15:53:56","date_gmt":"2020-10-23T15:53:56","guid":{"rendered":"https:\/\/paybis.com\/blog\/?p=4280"},"modified":"2023-07-21T14:32:34","modified_gmt":"2023-07-21T14:32:34","slug":"chainlink-crypto","status":"publish","type":"post","link":"https:\/\/paybis.com\/blog\/chainlink-crypto\/","title":{"rendered":"Chainlink Crypto Project – Why you Should Keep an Eye on it"},"content":{"rendered":"

As the market continues to recover, several <\/span>new cryptocurrencies<\/span><\/a> seem to experience huge growth in price and popularity. Among them is a project you have most probably heard of – Chainlink crypto. Its token, known as \u201cLINK\u201d, caused a massive buzz amongst traders and investors alike, helping it climb the ranks and claiming its spot in the top 10 cryptocurrencies by market cap.<\/span><\/p>\n

But what exactly is LINK and what makes it so popular? In this article, we take a look at the fundamentals of Chainlink, its connection to the current DeFi hype, and what it means for investors.<\/span><\/p>\n

Introducing Chainlink crypto project<\/span><\/h2>\n

Chainlink is a decentralized Oracle network. It is built to support and enhance <\/span>smart contracts<\/span><\/a>, by allowing them to access real-world data. By solving this challenge, smart contracts are able to connect with external information to enhance both their effectiveness and security. Let\u2019s explain this in more detail.<\/span><\/p>\n

How does Chainlink relate to smart contracts?<\/span><\/h3>\n

For the less technical among us, smart contracts are blockchain-based agreements that execute based on a set of conditions that have been predetermined.<\/span><\/p>\n

A good example to illustrate this is by looking at crowdfunding practices: if a number of ETH is placed into a smart contract by a particular date, the amount is released to the fundraiser – if not, then the amount returns to the donor. Since smart contracts operate on the blockchain, they are fully transparent and cannot be altered, increasing the level of trust among the participants.\u00a0<\/span><\/p>\n

For smart contracts to work, they require external information (off-chain data) to translate into the blockchain (on-chain information). The current limitations of smart contracts are primarily caused by the inability to create a common language between external data sources and blockchain-based smart contracts.<\/span><\/p>\n

This is where Chainlink comes in. Decentralized oracle networks act as a middleman between the two parties, through a large number of nodes, making the process more reliable (more validation points) and completely transparent (blockchain). Through this process, users are able to create 3 types of smart contracts on the Chainlink network:<\/span><\/p>\n