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CATEGORY: chainlink staking


Aug 27, 2021 10:38

Chainlink Staking – More Details Emerge On Its Future

Chainlink released a report about Chainlink staking. Many crypto enthusiasts were awaiting this event. It will start around July 27. Users will witness how their LINK tokens serve as collateral and assist with the processing & security of the oracle network. This will ensure that most participants in the network are honest. Dishonest participants get a penalty and will lose a portion of their stake.

https://twitter.com/chainlink/status/1420096706595762177

The recently released report titled "Explicit Staking in Chainlink 2.0: An Overview" references the earlier released vision for Chainlink 2.0. It would feature decentralized oracle networks (DONs) that are capable of performing off-chain computations. Chainlink staking would supplement the vision of high-value hybrid smart contracts. This is done by raising the cost required to attack the network and attempting to make it economically unfeasible.

Chainlink staking got a defensive design against a variety of attacks from well-funded adversaries. This goes to the extent that they are required to spend more than the combined deposits of all nodes in a decentralized oracle network (DON) resulting in high cost-efficient security, which makes these attacks extremely expensive and unfeasible by raising it above the value that can be extracted.

https://cryptoticker.io/en/instant-crypto-swap-instaswap/

It defines the service agreements that form the basis of all decentralized oracle networks (DONs) defining key parameters and performance requirements, data sources used, update latency, node payments, LINK tokens to stake etc. DONs have reporting rounds, where they release oracle reports with each node's response for a piece of data. The service agreements define the process for doing so and conditions for slashing. Chainlink marketplace can help to filter out nodes based on their performance, data sources used, networks supported etc.

Chainlink Staking Two Tier Network

This long-awaited staking would use a two-tier network. The first tier would consist of the low cost and high-efficiency decentralized oracle network (DON) of nodes staking LINK tokens. It is also responsible for generating reports regularly. These will come with maximum security and higher cost second-tier DON networks, which would oversee the first, provide arbitration and apply penalties for mass data deviations / malicious behavior.

What is the Resolution of the Disputes?

The decentralized oracle networks (DONs) complemented by Chainlink staking have a dispute resolution mechanism, If a dispute were to arise, all users would vote on the accuracy of the original report by "using a cryptographic TLS proof produced by DECO that provides definitive Zero-Knowledge Proof based evidence from one or multiple data providers".

Since the oracle reports are critically important, second-tier voters are economically incentivized to provide correct dispute resolution or risk their own security, reputation, usability of their products plus the value of their own token. These second-tier participants are likely to be the core development teams behind protocols as well as Decentralized Autonomous Organizations (DAOs) governing them.

https://cryptoticker.io/en/fidelity-digital-assets-crypto/

Chainlink staking has concentrated rewards. The misbehaving participants will pay to the node raising the alarm or the dispute regarding data accuracy. This allows for a system design where for each tier, one node has to be paid extensively to cause sabotage or malicious activity.

It raised the cost of the attack to the maximum. The security increases with the number of nodes in the system. It would also feature misreporting insurance to protect against incorrect alerts causing problems. A definite date for the Chainlink staking mechanism coming live didn't launch yet, but from the looks of it, work appears to be progressing fast.

Chainlink staking© Cryptoticker

The post Chainlink Staking – More Details Emerge On Its Future appeared first on CryptoTicker.

Feb 07, 2024 12:05

Whale Rapidly Accumulating Chainlink: Whats Going On With LINK?

A mysterious whale is rapidly accumulating Chainlink (LINK). According to Lookonchain, the unknown entity, possibly an institution, withdrew over 2.2 million LINK (worth $42.38 million) via 47 new wallets from Binance, the world’s largest crypto exchange by trading volume, in two days. This sudden block withdrawal now raises questions about what’s driving the whale’s interest and what it could mean for LINK in the coming days. Chainlink Is Key In DeFi And NFTs, Gradually Improving  Chainlink is a popular project that provides secure middleware services and allows smart contracts to access tamper-proof external data. For this role, the platform has been adopted by multiple protocols offering decentralized finance (defi) services in Ethereum and beyond.  Additionally, Chainlink plays a role in non-fungible tokens (NFTs) through its random number generator (RNG). It continues to release new products and enhance its features. Related Reading: Market Dip? Not For Dogecoin Wallets As Over 400,000 New Users Drive Frenzy Upward To illustrate, in November, Chainlink upgraded its staking mechanism, releasing v0.2, which significantly increased the pool size to 45 million LINK.  The platform noted that the decision was to attract more investors and, more importantly, bolster its security while concurrently aligning with its broader objective of attaining the “Economics 2.0” plan. Initially, staking began in December 2022. The goal was to incentivize participation by expanding the utility of LINK and allowing stakers to receive rewards.  The release of v0.2 in November means more tokens can be locked, helping make LINK scarce, considering the role of the token in the vast Chainlink ecosystem.  Trackers show that over 40.8 million LINKs have been locked so far. Chainlink confirms that anyone can earn a variable reward rate of 4.32%. Beyond staking, Chainlink’s Cross-Chain Interoperability Protocol (CCIP) is gaining adoption. To illustrate, the Hong Kong Monetary Authority (HKMA) initiated its first phase of e-Hong Kong Dollar (e-HKD) trials in November, integrating CCIP.  Related Reading: Ripple Initiates Large XRP Transactions Post Legal Setback As part of this trial, the regulator wanted to illustrate the capabilities of programmable payments enabled by Chainlink via its solution, CCIP. In DeFi, protocols such as Synthetix and Aave have adopted CCIP.  Will LINK Breach $20? With more protocols and traditional institutions leveraging the technology, the demand for LINK (and prices) will likely increase as the fear of missing out (FOMO) kicks in. While the whale’s motives remain unknown, their large-scale LINK accumulation suggests they might be bullish on the token. Notably, it coincides with the sharp expansion of LINK prices in the past 48 hours.  So far, the token is changing hands slightly below the $20 psychological resistance. Any breakout above this level might lift the token to around $35 in Q3 2021. Feature image from iStock, chart from TradingView

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