Bringing Chainlink Oracles to the Tezos Ecosystem
We’re excited to announce that we, in collaboration with Cryptonomic, are making Chainlink natively available to all developers building on Tezos. Oracles are a key component of a thriving blockchain ecosystem. As such, we have been working closely with the Cryptonomic and Chainlink teams to make Chainlink the go-to oracle solution for developers connecting their Tezos smart contracts to real world data and systems.
Integrating natively with Chainlink allows Tezos developers to utilize decentralized oracle networks to securely and reliably access off-chain resources and use them in their on-chain applications. Oracles allow developers to build smart contracts that incorporate off-chain data, take advantage of external API services, trigger settlements on existing payment networks, and more.
Combining secure, institutional-grade smart contracts on Tezos with Chainlink’s tamper-proof inputs and outputs enable the development of highly secure, data-enabled applications that are fully integrated with real-world data/systems. We are working with Cryptonomic, the team behind popular Tezos tools like the Galleon wallet, Conseil API, and Nautilus Cloud to make major code contributions to Chainlink’s GitHub repo.
Chainlink’s Oracle Framework
After extensive research, we selected to integrate Chainlink for its advanced, secure framework for building oracle solutions. We recommend it as the standard oracle used by Tezos developers, specifically due to the following attributes.
Secure and Reliable Oracles
The Chainlink network is made up of a growing list of 30 independent, security reviewed, and Sybil resistant node operators run by leading blockchain DevOps and security teams, many of which have extensive experience as Tezos bakers. Having a shared set of nodes makes integration more seamless and decreases the attack surface.
Developers can leverage Chainlink’s framework to build decentralized oracle networks, which incorporate decentralization at the node operator level. Using a quorum of nodes within a decentralized oracle network ensures that one node is not a central point of failure.
High Quality Data
While other oracle networks use open/free APIs and/or trial plans, Chainlink has external adaptors that allow nodes to manage passwords and call data from any credentialed API. Credentialed APIs are managed by professional data procurement companies, and give developers access to a much broader range of data types, higher quality of data and top service infrastructure levels.
Chainlink’s decentralized oracle networks currently secure high-quality market data for nearly 30 Price Feeds used and supported by many leading DeFi Dapps live on the Ethereum mainnet. Each price feed uses no less than seven nodes that each source data from different data aggregators, ensuring decentralization starting at the data level. The nodes’ responses are then aggregated and sent on-chain as a new price update.
Chainlink also offers additional data quality features such as Town Crier, which is the first and most widely used Trusted Execution Environment based oracle mechanism. Town Crier allows oracles to privately perform TLS verification, bringing greater assurances of data origin.
Experience and Expertise
Chainlink is the only decentralized oracle network with a track record of servicing smart contracts live on mainnet worth hundreds of millions of dollars. This performance is easily verifiable on-chain and the reason why they are already used and supported by numerous top DeFi protocols.
Long-Term Viability and Flexibility
Built with modularity in mind, every piece of the Chainlink network is upgradable so that different components can be replaced as better techniques and competing implementations arise. Tezos developers can feel comfortable investing resources into building on Chainlink’s framework, knowing it’s flexible enough to support technological upgrades.
Building Fully Integrated Smart Contracts on Tezos
By having a secure connection to all the inputs and outputs needed to achieve reliable end-to-end functionality, Tezos developers can start building a variety of new products across numerous different markets. Here are just a few of the many ways to leverage Chainlink in real-world applications.
Decentralized Finance (DeFi)
Tezos is a great blockchain for financial applications, and therefore Tezos developers need to expand the financial services available to users. Some immediate use cases include a stablecoin for pricing network computation against fiat currency, lending/borrowing to expand credit for financing services, and derivatives for diversified financial strategies. To build these important DeFi applications, Tezos developers can leverage Chainlink to source high-quality data and deliver it on-chain to execute key contract functions such as for loan issuance, derivatives liquidation, spot trading, and pricing real-world assets/NFTs on-chain.
Insurance is a key risk management component of any financial ecosystem. To provide insurance, the smart contract needs to be externally aware of details surrounding the insurable events. Oracles provide gateways into disparate systems such as receiving data from IoT devices about the condition of a vehicle, shipping container, or home. They give smart contracts access to web APIs to determine if it rained or if a flight was canceled or if a smart contract was hacked. Leveraging Chainlink, Tezos developers can start building parametric insurance models such as crop insurance for developing countries, shipping protection against damage, and more.
We believe this project will help to facilitate the next wave of Tezos smart contract and application development and we are proud to collaborate on it with the Cryptonomic and Chainlink teams.
Note: chainlinkecosystem.com does not claim any ownership of this content, all credit to SmartPy, view official announcement.