By - BeerBellyFatAss
*Things that would pump us 47% in 2017 for $400, Alex*
Somebody didn't buy chainlink
Why does this require chainlink? I don't get it. Openlaw already has an API.
It is "easy" to query a single API but if we rely on a single API then what is the point of using blockchain/smart contracts for digital agreements?
The unique property of smart contracts is that they are highly reliable - they will execute given an input. They achieve this highly reliable state by sitting in their own world - they do not know the price of the USD, the score in a football game, the temperature in Sydney.
Given the immutable nature of blockchains (this is their reliability), this makes the input of the data into smart contracts incredibly important - you can't have poor quality data triggering these agreements.
Hence feeding a single API (a centralised source) into decentralised smart contracts just doesn't make sense.
Chainlink provides a solution to this by allowing the decentralisation of the data (at both the data source level and through the use of multiple nodes) that is brought into the blockchains. It is going to make blockchain and smart contracts useful at last.
Edit: I have re-read the above statement and it sounds even more meaningless. It is imprecise, misleading and uses crpyto buzz-words to obfuscate what is a much simpler setup. I don't know why it received so many upvotes. Smart contracts are nothing special. High reliability systems dependent on input data streams have been with us for decades. Important data (imagine stock pricing data from the Dow, or temperature data from a network of sensors operated by NOAA across New York State), typically comes from a small number of high reliability sources. Using a single source clearly runs the risk of failure, but this is obvious. So smart contract operators will draw directly from the *sources* they judge to be authoritative. There is no need for middleware, that invokes complex game theoretic arguments, and there is no "cloud" of possibly untrusted data from which smart contract operators might exploit. I mean, they could, but why? *They will go directly to the (authoritative) sources*, and put in place the necessary coding infrastructure to provide secure access to that data, in collaboration with the provider who is working hard to maintain data integrity (*because their business model is predicated on this*). In fact, with a few independent authoritative sources, with data stream infrastructure developed independently, robustness to single point failure will naturally take place.
I think you misunderstand the concept of decentralisation. The business model for data providers is driven by the overarching incentive to provide accurate and reliable data so that the originator does not lose customers. Poor data = end of business. Indeed, the data is typically incredibly valuable, so the need for high reliability and integrity is already baked into the business. *Customers fundamentally want centralised data from high reliability sources*. AFAI can tell, LINK is some half baked middle man with a flawed business model. High reliability data providers just need an open framework to pass their data to paying customers - they don’t need LINK nodes to “decentralise” their data. It is centralised by design.
I think there's a few nuances to grasp here:
1) Chainlink is a framework for composing oracle networks. Contract architects can use a single node/source if they wish.
2) Decentralisation at the node level is vital. Hence you would want multiple nodes verifying input from the API.
3) It appears that some customers *fundamentally* do want data source decentralisation. The biggest news recently on Ethereum in my mind was [Arbol's crop insurance announcement](https://www.coindesk.com/chainlink-to-provide-data-for-farming-insurance-startup-arbol) which uses three data sources. These guys are certainly not your [average 2017 startup](https://www.artemis.bm/news/arbol-transacts-11m-notional-through-weather-risk-platform/).
Another example of data source decentralisation is within DeFi. I hope you can get why relying on a single exchange API is not a good choice.
A great place to start would be the whitepaper.
None of this requires LINK or any other middleman.
I am a bit confused by what you mean. Do you mean Chainlink, the network? Or Chainlink, the company? It must be emphasised that the company takes no transaction fee/cut from data delivery. (Or the network for that matter).
Just accept that you missed LINK and move on.
Chainlink is the most overhyped product of this bubble
I detect a nolinker
Agreed, but the current blockchain bro hype around what is perceived as an oracle is ridiculous and chainlink is ridiculous. I get that the market is nascent and infrastructure takes time, but it's hard to get excited about something so mediocre and obviously dressed up.
Yeah, Aave and Sythentix aren't very sharp so I don't know what they're doing using Chainlink.
Emmm? Using the only reliable oracle solution for DeFi, not trying to reinvent the wheel and focusing on their job
What do you mean? If you don't trust the OpenLaw API then what use is integrating to OpenLaw? That's how the oracles would be getting data anyway. A single point of failure with a thousand different oracles accessing it is not a thousand times more reliable than a single query against that API.
Also - Nice random LINK shill image macros.
I remain firmly convinced that Chainlink is a solution in search of a problem. Plenty of huge services used oracles before Chainlink came around and still do without Chainlink's help. You don't need a giant network of oracles with a complex collectivization and game theory system and a rent-seeking token in the middle. You just need, like, 3 oracles that you vote between. It works fine.
What is OpenLaw doing? You are misunderstanding what their value add is. Have a read of their blogpost I linked.
Which services used oracles before Chainlink? Which services had real value? How is Oraclize doing these days?
MakerDAO was the first application to introduce oracle decentralisation through their bespoke solution with 14 nodes - and for which they should take a lot of credit for. Chainlink reflects this thesis but provides a far broader and more flexible framework for composing oracle networks.
Contract architects choose the number of data sources, the number of nodes - it's up to them.
MakerDAO is an excellent example of a system that doesn't pay a middleman and works just fine. Is there a reason that instead of using this robust, simple, non-dependent and non-rent-seeking solution a project like MakerDAO should instead buy some random middleman token and then use them to pay third parties to run those same API queries?
Furthermore - suppose you wanted to have the ability to outsource API call interfaces into the chain- I realize it's fashionable lately to pretend that Chainlink is providing something valuable because nobody wants to pop the bubble but if you could literally build the exact same system but incentivize these API query-bots with ETH instead of a token minted for the express purpose of enriching the developers of the token and the scheme *still works* then it's a giant red flag that something is wrong in the design of the system.
But that's the thing right - they *are* being paid. There is no such thing as a free lunch. It's simply that those costs are covered by MakerDAO to ensure that the nodes continue to provide the data. The parties aren't doing it for fun.
I think you have a fundamental misunderstanding about the work that Chainlink nodes are doing - they are either providing or relaying data and they should be paid for this. Just as Ethereum miners are paid in ETH. Or Bitcoin miners are paid in BTC. As such, there is no "middleman" - Chainlink does not take a transaction fee - there is simply node operators being paid for work. They must pay for access to premium API providers (if they do not provide the data themselves), they must pay server costs, salaries, overheads. These are [established companies](https://feeds.chain.link/) who are securing value. Some are [very established](https://www.t-systems-mms.com/en/expertise/archive/smart-contracts-made-reliable-and-useful-with-the-real-world-data.html)!
As for the use of the Chainlink token, I think the most fundamental aspect is that Chainlink is a decentralised oracle network - it is by no means bound to Ethereum and indeed, the current integrations in progress with Polkadot and Tezos show the early stages of this being built out - it is much bigger than Ethereum. Here's a very good article that goes into [greater depth](https://medium.com/@The_Crypto_Oracle/the-seven-requirements-for-a-viable-decentralized-oracle-network-e634710ea11f).
>there is no "middleman"
This is the fundamental issue I have with the project - there is an enormous middleman. Ownership of the majority of LINK tokens have been retained by the authors of the protocol. The authors inserted a worthless middleman token, managed to convince a community it has value, and now stand to profit on the order of *billions* of dollars when they inevitably 'release' these tokens into the ecosystem. It's basically the dream gameplan of every scam token out there.
Unnecessary token, massively uneven token distribution, pumenomics project structure-
it all stinks like scam token.
I think you’re absolutely right. A basic consideration of the issue of data provision reveals that in most cases data providers are heavily incentivised to provide accurate and reliable data - quite literally if they don’t, they go out of business. So the notion of “decentralised” data providers doesn’t even make sense. AFAI can tell, all that is required is an open framework that facilitates the secure transmission of data feeds to paying customers (and their smart contracts). Incentive to ensure that the data is reliable is already fundamental to the business model. What am I missing?
Have you read the whitepaper? I think you're smart but you just haven't done your reading.
I have read some of chainlinks papers. But I don’t need a paper to understand the basic incentives behind data provision. You haven’t said anything that clearly and simply addresses the fundamental issue that data providers are already heavily incentivised to be of high integrity. There is no need for a “network of oracles decentralised at the node level” if I am buying a data stream from a reputable provider.
It's really how you interpret the token distribution. I thought just the same as you back in late 2017 but as I read once, sometimes smart people focus on problems and don't "believe". Certainly, the crypto space as a whole since the bull run has engendered this thinking - it is easy to be cynical because it's usually right.
And you are quite right, that they could dump millions of tokens right now and be rich for the rest of their lives.
But think of what Vitalik has spoken of recently, how he wished that more ETH had been kept aside for development. Look how subsequent projects have learnt the lesson and allocate funds. Look at Emin Gün Sirer's new project. "Fair" distribution usually just means that whales and speculators have the asset and not those who actually "do".
For Chainlink, the token distribution provides it with a massive warchest in which to fund development for the foreseeable future and bootstrap the network in its early years through subsidies to node operators. In this way, the network will become a public good, with SmartContract not taking a cut for the operation of the network.
So in time, it will likely be run as a foundation, with core employees employed to maintain and add features to the network. Then there are other teams (which you can already see such as https://reputation.link/ and LinkPool) that are being [funded](https://blog.chain.link/introducing-the-chainlink-community-grant-program/) build out other aspects of the network.
I understand why some are put off by the token distribution but it essentially allows the whole network to be built out with maximum control from the team. They are not subject to VCs; they can just build.
>In 2010, he served as a teaching assistant to NYU Professor [Lawrence Lenihan](https://en.wikipedia.org/wiki/Lawrence_Lenihan), the founder of the early-stage investment company Firstmark Capital, and he followed that up with a six-month stint at Firstmark doing technical due diligence on technology startups.
>"The reason I took that job over other jobs," says Nazarov, "was because I wanted to learn how people build technology companies."
Lastly, you have to look at the context. Look at their advisors... Ari Juels, Tom Gonser, their close work with IC3, the ongoing collaboration with Google, with Baseline. A team of 40. Several big teams using them. Handpicked by the WEF. Are they all wrong? Or are they all driven by greed? Or by naivety?
Gotta keep the price up somehow
Maybe cross chain functionality with other openlaw like systems built on other chains? Not sure.
This may help: [https://www.youtube.com/watch?time\_continue=170&v=nddXMjT4fCk&feature=emb\_title](https://www.youtube.com/watch?time_continue=170&v=nddXMjT4fCk&feature=emb_title)
Four years ago, I posted this text about Software Licence Management as a potential Ethereum application. It looks like now finally technology is catching up to make this feasible:
Everyone who works in IT knows that software licence management is one of these awkward and complicated problems that no one likes to deal with.
Tracking licences within a company – especially if it is an IT company - is a nightmare. Literally thousands of different devices with different software versions and licencing policies need to be managed. Constantly monitoring who is using which licence on which router, server, PC, laptop, tablet, or smartphone is at least very difficult and requires its own tools.
On the other hand, a software vendor can never be sure to which extent his clients really pay the correct licence fees. Costly on-site audits are required to get a clearer picture. However, these findings will be outdated after a short time and in certain business cultures – think World Corruption Index – impossible to gather at all.
Still, fair licence management is a pure necessity – on the licenser’s side for commercial reasons and on the licensee’s side for legal reasons and due to compliance requirements.
Ethereum contracts can provide a very elegant solution to that problem. All that is needed is a smart licence contract a software has to connect with to work properly – the contract takes care of the rest, either by billing the licensee accordingly or by directly consuming ether (or bitcoin) payments.
Time and/or location limits, staged prices, floating licences, volume or group discounts, kickbacks – every imaginable licence policy could be easily implemented.
So, here we have all that is required for a killer application: a strong demand rooted in the needs of a worldwide multi trillion dollar business and an elegant, efficient solution that perfectly matches this demand.