- Chainlink is an oracle network that provides a bridge between Blockchain smart contracts and off-chain data.
- There are some rumors about Grayscale getting ready to launch a LINK-based investment product
Chainlink (LINK) is a popular project in the crypto space, which has attracted a significant number of investors. This is evidenced by the fact that LINK is the 7th largest cryptocurrency on the market today, and has a market cap of around $9 billion. Chainlink had an outstanding performance in 2020, and now many crypto fans are interested if it can perform similarly this year as well.
What is Chainlink?
Chainlink is an oracle network designed to provide reliable data to smart contracts deployed on blockchains such as Ethereum. Chainlink connects smart contracts that are on-chain to the off-chain data sources like APIs, bank payments, etc. The Chainlink team launched an ICO in 2017, raising 114,285 ETH.
LINK is the biggest Ethereum-based token by market capitalization. It is an ERC-20 standard token, but also has functionalities associated with the ERC-223 standard. This functionality permits the processing and reception of the tokens inside a particular transaction. The tokens are paid to node operators for the data they provide. There are many operators in the space now, and considerable growth has been seen since the mainnet launch launch.
LINK has oracles for ETH and its trading pairs. Applications and so on can utilize the oracles. The Chainlink network has three solutions to avoid insufficient data and vulnerabilities for oracles. One solution is voting, and data from the Chainlink network is selected and validated through this process. The network chooses among the oracles and guarantees the best performance.
Whenever a smart contract wants some data from the network, every node offers its data and puts some tokens at stake. The tokens are dispensed among the nodes that provided quality data. This system of operation encourages the nodes to behave honestly.
A Chainlink Trust from Grayscale?
Crypto asset management company Grayscale recently registered a series of trusts in Delaware. The names of the trusts reference different cryptocurrencies, with some examples being Chainlink, Tezos and Filecoin. Grayscale is a major company that offers products for investing in cryptocurrency. Some of the company’s products are focused on specific coins like Bitcoin and Ethereum, while others give investors a way to invest in the cryptocurrency market more broadly.
Among the altcoin names referenced by the newly-registered trusts, Chainlink would seem to be the most likely option if Grayscale actually does decide to go ahead with a product launch. Rumors about Grayscale introducing LINK to its lineup of crypto investment products have fueled speculation, and provided some additional volatility to the LINK markets. On January 25, the token’s price reached an all-time high above the $25 price level.
Grayscale is one of the largest cryptocurrency asset managers in the world, holding more than $25.5 billion worth of cryptocurrencies. It has crypto regulated products for the public in the United States of America. The company offers products that are accessible to traditional investors, and allows them to gain exposure to the cryptocurrency asset class.
Andrew is a writer that does most of his work on cryptocurrency-related topics. While he’s primarily interested in Bitcoin, he also follows major altcoins and the innovative ideas that new cryptocurrency and blockchain projects are bringing to the table.