Hey, yo, what is going on, what is up & what is right with my people, who I like to call the viewers of the tube. My name is Tyler and you just entered the crypto channel, that keeps it weirder, than 7/11 at 3 am in the gosh dang morning. You know how we keep it brief, in our briefs. Its time for Chico Crypto! Weird you say, Chico, let’s get weird to end this work week & bring on the weekend? How about we get stinky? I’m talking that stank, rank, chainlink.
There is a lot to talk about with those stinky linkies, staking, the service agreement, baseline integration & more So let’s begin with something that I know is the most important piece of chainlink, the service agreement, which involves staking, which involves decentralizing the entire network of oracle nodes.
So, if you didn’t know, chainlink is live right now, there is a network of oracle nodes, providing data to requesters. Chainlink market has a great list breakdown of the nodes, and the data request jobs they have run.
Linkpool, 27 data feeds & over 121 thousand jobs ran, chain layer, 28 data feeds & over 113 thousand jobs ran, Views, 111 thousand jobs ran with 32 data feed, and the list goes on But right now since there is no service agreement and staking with nodes, the chainlink manner isn’t fully decentralized yet. These service agreement contracts are not required for the early version of Chainlinks manner.
Currently, node operators can still accept jobs and get paid in LINK for completing said jobs, but no upfront tokens will be required to accept the job and therefore there is currently no ability to stake nor do nodes require any LINK tokens on them. So requesters are still paying the node operators to retrieve data and reach consensus on the data that is provided. So as of now, it works like this requesters, from the world of apps, applications and more.
AKA web3, and the decentralized computation network needs data, it submits a job request, in the form of smart contract to the chainlink network or oracle nodes, and those nodes get the data from providers, who they are connected to the nodes connected to the data providers, the requester wants, reach consensus on the data provided, and then send it back to the requester, in the decentralized computation network.
So, you are not using a single node, to get the data, a single point of failure and creating centralization in smart contracts, which are supposed to be decentralized, including the apps running them. You can’t have the decentralized computation, without decentralized oracles.
Now, we have decentralization, in providing data back to requesters, the world of web and computation. But, since the service agreement and staking aren’t there yet, there isn’t a way to be fully trustees, with the node operators as they don’t get penalized for bad data or bad time.
But those service agreements and the staking that comes with it makes #1 both the node commitment and performance of the node, is on-chain and fully verifiable, #2 Oracles who deviate from their commitments, have an immediate economic loss from their stake and #3oralces who can’t fulfil their commitments won’t be selected for other job quorums, losing out on a ton of potential revenue.
So staking is about decentralization, but not in the sense of coming to consensus, staking is about creating crypto-economic security, so data requesters can trust the network and not a single entity. And this is when Chainlink goes nutty my fatty in my opinion. why do you ask? Well, since the jobs they are running likely have to do with a lot of money, the oracle node operators in the network, have to stake that dollar value in link with their node remember immediate economic loss from their stake?
Yes, that is so they don’t provide bad data to a say derivative contract worth 100s of millions of dollars? What? Your saying 100s of millions of dollars in Chainlink will be staked by node operators when the service agreement goes live? Ya, I’m kind of saying that, as during a baseline protocol meeting, it was dropped how much value is being secured right now, in the current version with chainlink nodes. Let’s listen in.
Yes, 100s of millions, so when the service agreement goes live, we should see 100s of millions of dollars in chainlink staked right away. And the flagman, himself, Sergay decided to do a long, long presentation on Chain Link just a couple of days ago, titled The Evolution of Smart Contracts and Crypto Economic Security and guess what? He explained the staking that is coming.
Let’s hear what he had to say So, the stake rewards, they will be paid out based on the service agreement, could be right back to the node, could be to dapp developers, could be to users of the app, could be to stakes with the node or combinations of the like & chainlink is going to support 2 types of staking.
Implicit and explicit. Implicit is what is stands for implied, but not plainly expressed. Node operators in Chainlink, have a stake with the network, if they deviate front he protocol, the asset they hold, Chain Link will decrease in value, if they provide good data and don’t deviate, Chainlink will increase.
An explicit stake is just that, stated clearly for specific contracts but the combination of the two creates a bulletproof economic security layer for the network. So, when is this coming? When are we going to get that sweet stake and service agreement?
Well, you should have this web link saved if you’re a linkhead like myself. The chainlink pivotal tracker, of which the link for it is in the description. So this is where the chainlink development is tracked, and we can search by service agreement to see what has been completed.
Typing that into search project, we find all the tasks that have been completed. As we can see there are 26 done stories aka development tasks Lets check them out the specific done story, is this one the service agreement initiator that is done, so agreements can be initiated. how about tests? Have tests been done with the service agreement? As we can see, add service agreement integration test, is done and completed.
And finally, we can see the last thing completed regarding the service agreement was adding agreement aggregators into the service agreement. But then we get to the icebox, the blue, these are stories that have not been scheduled and as we can see, basically there is 50 percent to go regarding the service agreement.
How long will this take? Well, I’m not going to make any more predictions regarding the chainlink staking date, I have been so wrong before, though it was coming out last year.
But, the fact that Sergay is speaking about it, on a deeper level, leads me to believe the staking & service agreement is about to get a development sprint & we will see many of the tasks in the icebox, be scheduled and start turning green.
Now, the thing we need to worry about, in the meantime is the growth of the chainlink network, node operators, data providers, and the requesters.
Because when this goes live, it creates a self-reinforcing loop, which will be hard to beat in the oracle space. Well, we can visualize this, with the LINK rewards being paid out. The more LINK being paid to nodes, the bigger the growth of the network all around.
And just look at the growth since the launch of the mainnet, exponential growth with now over 600k LINK tokens paid out since launch, and that data put together by crypto sponge ended on May 25th, so I wouldn’t doubt another 50k token has been paid out since. And you guys, this is just DeFi crypto-related stuff, we aren’t even talking about the outside world, some of Chainlinks major enterprise partners diving in.
So you guys know Fidelity, they have branched into cryptocurrency with Fidelity digital assets, well Fidelity has some patents out there, regarding smart contracts and blockchain data fetching oracles.
They manage 2.4 trillion dollars, and guess who is apart of ic3 together? Chainlink and Fidelity Labs the ones who file patents for Fidelity as we can see from their website 200+ since its founding in 1999 & as we can see from this old article, Fidelity started their patent program in 2012.
So, 100s of million versus trillions, that could be coming in the future for chainlink. Down the road, yes, but seeing patents filed, by Fidelity Labs who has been working alongside chainlink with IC3 since 2017 ya I hope you get the picture. Cheers, I’ll see you next time!.