Chainlink, much like every other cryptocurrency, has experienced both gains and losses. Nevertheless, this long-lasting effort serves a genuine purpose and has a strong potential of being adopted by a significant number of people. The following is a list of the top five reasons to have an optimistic outlook regarding Chainlink and its native token: LINK.
5 Reasons to be Bullish on Chainlink (LINK)
An oracle in demand
Chainlink is one of the most significant cryptocurrency projects. There needs to be a means to “get data onchain” for blockchain technology to realise its full potential. Scores in various sports, stock market updates, historical events, and other information. Chainlink can supply the data needed by the fast developing crypto ecosystem for smart contracts and metaverse applications.
There are over 1600 different crypto and non-crypto businesses integrated with Chainlink, according to their website. What’s most fascinating is the rapidity of the expansion. A recent blog post claims that by the start of 2021, the Chainlink Network had raised $7 billion for use in the blockchain industry. A year later, Chainlink oracles have secured approximately $75B in value, representing a tenfold increase in TVS.
By increasing the overall value held by a factor of ten in just twelve months, Chainlink has established itself as one of the largest value-securing protocols in all of DeFi. Chainlink primarily integrates with Ethereum protocols, but also supports Polygon and Binance Smart Chain.
Chainlink is the industry leader
Chainlink is, by a significant margin, the most widely used decentralised oracle. There is not a single other initiative that even comes close to matching the size and scope of the ecosystem that Chainlink has created.
The network effect is one of the greatest measures for analysing the value of a protocol, and Chainlink possesses a significant network impact that is widespread and well-established. It would be quite challenging for a new oracle service to launch their product and overtake the dominant position that Chainlink has already established in the market.
Chainlink will soon have a staking feature. Given that Chainlink is an ERC20 token, it will not require coin locking from stakers in order to maintain network security. On the other hand, staking will be used to ensure reliable service and prevent malicious data modification.
Chainlink requires a network of nodes to import information. When staking begins, nodes will stake LINK as a guarantee that they will only send high-quality data. A node’s staked LINK will be reduced if it submits invalid data or fails to do so by the specified deadline.
Staking one’s LINK with respected community elders is another option. By sharing the risk, community staking encourages users to keep an eye on oracles to make sure they’re dishing out accurate information. Chainlink staking, if all goes as planned, will provide a means to earn LINK passively while also improving the stability of the oracle network.
Unfortunately, hacks and attacks are very widespread in the crypto industry. Recently, an exploit was found in the Harmony bridge, and prior to that, Axie Infinity suffered a loss of several hundreds of millions of dollars because the Ronin sidechain was vulnerable to attack.
Despite the fact that new projects are always interesting, it may be prudent to put your money into a protocol that has already been thoroughly proven, such as Chainlink.
Chainlink is a protocol that has been around since 2019 and has demonstrated that it is both robust and has high security. Although it is impossible to state with one hundred percent assurance that a vulnerability cannot be exploited, the code appears to have performed admirably up until this point.
A grand vision for LINK
Chainlink’s creator, Sergey Nazarov, has lofty goals for the cryptocurrency’s implementation. Sergey wants Chainlink to become an interoperability protocol connecting all of the largest blockchains, beyond just being an oracle data provider.
Chainlink operates as a central point where smart contracts from various blockchains can communicate and share data with one another. Sergey envisions Chainlink, in the future, as the virtual highway connecting the many blockchain cities.
The CCIP abbreviation stands for the Cross-Chain Interoperability Protocol, which is the official name for the cross-chain bridge. The protocol should also facilitate the exchange of tokens between different blockchains, in addition to data transfers. Chainlink’s status as an impartial intermediary could be an asset in some situations. Chainlink is not a rival to smart contract platforms like Polkadot or Cosmos.
Chainlink’s distributed node network provides all the necessary components for a swift introduction of the CCIP standard. Chainlink and the LINK token might see massive benefits if CCIP is widely adopted.