Chainlink (LINK) cryptocurrency - what is it and why is it needed in simple words
ChainLink virtual currency is a cryptocurrency (a family of altcoins ) that facilitates the process of interaction between consumers and suppliers of goods / services. Based on the extent to which blockchain technology is actively being integrated into the life of the average person, we can conclude that digital currency is in maximum demand.
The crypt rate has recently taken off, which is why a large number of investors began to pay special attention to this project. And in order to understand whether this investment option is really promising, and whether a digital coin can gain popularity, you need to familiarize yourself with all the nuances of this cryptocurrency.
What is ChainLink?
So what exactly is ChainLink? This cryptocurrency is a digital token from the eponymous trading platform, the purpose of which is to apply the crypto smart contract technology called Ethereum using the API technology. Thus, all users have the ability to connect to any existing payment system and perform all monetary transactions. In addition to the Ethereum system , the Link blockchain can connect to a well-known network called Bitcoin .
In a more technical language, ChainLink acts as software that has its own internal virtual currency in the form of a Link token. In addition, it should be noted that the system has in its staff some oracles that collect information from the environment. Such a function is needed so that when transactions are concluded, monetary and other transactions, it is possible to collect an additional package of information.
It should be noted that a smart contract is a progressive technology, thanks to which blockchain and system users are able to exchange digital coins and other assets without the help of an intermediary person. However, there is one difficulty in their implementation, which is its connection to the source, which uses a traditional payment channel. Buffer software (oracle system) helps ensure reliable communication using the Bitcoin and Ethereum network. Thanks to them, two different parties will be able to conclude and carry out any transactions without using the services of intermediaries. However, this is possible only under one condition - compliance with all existing obligations.
ChainLinks history began a long time ago, back in 2014. Since that moment, the Crowdsale (a joint collaboration of users who adhere to one goal - to pool funds or other resources in order to finance a project), has been able to collect over thirty million US dollars received after exchanging the ChainLink digital coin for fiat money ... This event, unfortunately, led to an unfavorable outcome and a loud scandal. On September 19, 2018 (at 17:00 Moscow time), the ChainLink virtual currency project began its workflow. However, its operation only lasted for ten minutes.
With regard to the unfavorable outcome, criticism, indignation, the reason for this was the receipt by the contributors of inaccurate information. At the same time, a wave of criticism struck Crowdsales policy of collective interaction. As for the technological component, as well as the general capabilities of the ChainLink virtual currency, this did not cause dissatisfaction among investors and other users. In order to take part in crypto mining, the user must:
- make a contribution of one hundred Ethereum coins;
- the next step is to register in a system called ChainLink, and you do not need to enter your email address.
Within two days after a person became a full participant in the project, he received a letter with details of the work process. After sending the money, the user became the owner of his own Ethereum - the address where he had to quickly transfer 7 digital coins (at the same time, half of this address was inaccessible). It is worth noting that the start of the project was not as successful as its developers imagined. The secret component of the sent address was discovered some time later. Ten minutes later, a project manager named Sergey Nazarov announced that the token sale was over. A large number of users who are owners of a digital coin have already sent a lot of money and the same amount of messages at that time. As a result, no one received a single answer.
Before all these unpleasant events, the leaders of the digital currency had plans to accumulate about $ 16 million. And I didnt have to wait long - the whole process took no more than a few minutes. Many users to this day believe that they are deceived. However, the truth lies elsewhere - the project itself was deceived, that is, the managers themselves made efforts to ruin their reputation and lose the trust of their clients.
Distinctive features of ChainLink
To date, the ChainLink project is aimed at creating a distributed (decentralized) oracle system that will be fully compatible with such blockchains as Bitcoin, Ethereum, HyperLeger. From a technical point of view, the ChainLink network began its life by signing a blockchain contract that was created on the basis of a trading platform called Ethereum. This contract is a smart contract, which is the main distinguishing feature of the crypt from its similar options.
ChainLink smart contracts perform three main functions.
- Assessing reputation. The investor can independently apply these contracts, which have a specific range of characteristics, including the reputation of all oracles, as well as an assessment of the service, which is called a "Service Level Agreement". An oracle who violates the rules of the system and supplies false information will be punished by reducing the level of his reputation. In the event that contracts collect the required number of requests, then from that moment the process of a service agreement with ChainLink can begin.
- Publication process. When the required number of off-network oracles have already been selected, then you can begin to conclude agreements, delivering the requested information at the software level.
- Aggregation process. The contract, which is in the process of aggregation, collects the information transmitted by the off-network oracles and then averages them, creating weighted aggregate responses.
These smart contracts process information requests from a network user who wants to use the oracle service provided by ChainLink. In order to become the owner of access to non-network information, users can use a smart contract, which subsequently processes external data in a crypto-specific smart contract.
How ChainLink works
In order to successfully create a branched system with oracles that have passed the verification process, the creators plan to offer users of any information channels, feeds or API addresses to provide data to ChainLink. For this they will be awarded bonuses in the form of Link tokens.
The ChainLink marketplace consists of two working parts:
- blockchain for internal work;
- off-chain for external functioning.
For the reliability of system performance, these two components must be in constant interaction with each other. Blockchains are validated by oracles for compliance with every smart contract request. With regard to off-chain, it should be noted that it consists of a large number of different nodes (users) connected to the Ethereum system, receiving information from completely different external sources that do not depend on each other. Such a user can be the owner, for example, of a popular exchange that presents a number of informational data based on the trading taking place at the moment. Or it can be a certain payment system that performs the process of providing data on monetary transactions.
To date, ChainLink has been able to create its own trading platform that is compatible with the three most popular systems such as Bitcoin, Ethereum and Hyperledger. In the near future, developers plan to expand blockchain support.
ChainLink advantages and disadvantages
Like all cryptocurrency options, regardless of their level of prominence and popularity, ChainLink has both advantages and disadvantages.
The main positive aspects include:
- the system has a number of blockchain and smart contract functions, while constantly remaining in a state of decentralization (dispersed);
- all information coming from the external environment is thoroughly checked for reliability and authenticity;
- in order to carry out transactions, oracles are involved in the case, which are intermediaries who guarantee complete security and a high level of reliability;
- for the fact that a monetary transaction was carried out within the system, each user will be credited with a certain reward in the form of Link coins;
- instantaneous performance of any monetary transactions, transactions, including the ChainLink exchange within the network.
However, despite the large number of advantages, this crypt has a number of disadvantages that have a negative impact on the further development of the project. The negative sides include:
- blockchains , offchains can solve problems, but only in narrow segments of smart contracts. This in turn can pose a significant obstacle to project scalability;
- reversibility of the process, if an unreliable monetary transaction in the system made in the system is determined, is not provided. In other words, an erroneous transaction is irreversible, so no one will return the money to you;
- if the total number of transactions with money increases, then this can serve to increase the likelihood of a failure. It is difficult to guess all the consequences that can be caused by even a slight overload. However, the most common problem is a significant loss for each user of the system.
The entire development team is trying to present ChainLink as an open, democratic project, but this does not quite work out, since the beginning of its work does not quite correspond to all characteristics. The close relationship of the crypt with SWIFT, Cartner became the reason for the spread of rumors about the conclusion of a dubious deal.
A large number of users are confident that the Cartner team has decided to distribute the pre-sale tokens among all its members. On top of all this, a technical glitch in the Initial Coins Offering, a large number of disgruntled Priority Investors, and the misnamed total that was raised using the Initial Coins Offering - all of these moments could significantly damage the reputation of the virtual currency. However, this did not cause global damage to the project. The creators also continue to develop their product, and subsequently plan to conclude a profitable partnership agreement and increase the user base.
Does ChainLink mining exist?
It should be noted right away that the ChainLink cryptocurrency is not at all intended for the mining process. ChainLink (Link) is a dispersed oracle service whose main purpose is to connect smart contracts with information coming from the environment. Since the blockchain does not have the ability to gain free access to information that is outside the limits of its system, the oracle acts as a channel of information in a smart contract. The ChainLink network uses tokens called Link. They are needed in order to extract streams of off-net information. All tokens are formed into a readable blockchain format and an off-network computing system, which in turn guarantees a reliable, secure workflow.
In order for smart contracts to use the ChainLink node in various systems like Bitcoin, Ethereum, it is necessary to pay for a specific operator called ChainLink Node using link tokens. To compensate for all the needs of the system in the network chain, the Link token is used as a payment. It must be created according to the same principle as in other, similar systems. In other words, tokens are created in order to pay off-chain services for the ChainLink software. Can we say that it will be in demand? Everything directly depends on the number of customers who have opted for this system. Determination of demand is possible only after the start of the workflow. If a large number of people do not join the network, then the token will be devoid of any value. In the near future, the developers plan to release about one billion coins.
How to buy or sell ChainLink?
A cryptocurrency called ChainLink gives every network operator, who are rightfully suppliers of various information, an opportunity to make good money with their own tokens - Link. For the fact that they use smart contracts in conjunction with the oracles of the ChainLink system and are included in the system, users can receive a reward in the form of several digital coins. And the more the organization and information providers work, the more rewards they will receive. The best method that can be applied in order to become the owner of tokens is to implement this system in your personal business.
For an investor (depositor), there is a much simpler method than the previous one. This refers to the acquisition of cryptocurrency on a special crypto exchange. The trading of the currency pair with the Link token and ChainLink crypto is actively conducted on such bases as:
- FCoin and a large number of other cryptocurrency exchanges.
It should be noted that the best and easiest way is to buy a coin using Bitcoins, Ethereum, Ripple, or thanks to the virtual currency - Tether dollars. It is these digital coins that account for a large volume of trading.
ChainLink rate to ruble
In order to study a detailed course of ChainLink to the ruble? It is necessary to use a currency converter, as well as charts of changes, which occur within an hour, day, week, month. Thus, you can accurately trace the dynamics of changes and determine which period is favorable for investment. To date, 1 Link token is 160.478113578 rubles. During the first half of 2019, the exchange rate increased by 151.61 rubles.
ChainLink rate to USD
ChainLinks rate to the dollar has recently been able to please with a stable increase, which in turn arouses incredible desire among all depositors, despite their level of security. The indicators in the currency chart are of particular importance for those who wish to actively exploit Link virtual tokens in their own business.
To date, with the current schedule and exchange rate, you can study it in detail on the official website or use a calculator with a currency converter. Today, 1 Link token is equal to 2.507 US dollars (August 2019).
ChainLink rate to EUR
ChainLinks current rate allows you to get acquainted with the chart as closely as possible, which indicates all the changes that occur in the cryptocurrency market and exchange. Today, many modern people are increasingly using the Internet in order to earn money. To do this, they use special sites and certain specialized software.
After accumulating a specific amount of tokens, you need to familiarize yourself in detail with the current rate, after which you can safely perform various transactions and other monetary operations. Today, the cost of one Link token in relation to the euro is - 1 Link = 2.261833 euros.
Where is ChainLink stored?
Many of those who own the digital currency and virtual tokens of ChainLink (Link) often ask the main question about where you can store ChainLink? Today there are a large number of wallets, so everyone can choose the right one for themselves. Among them, the following types of reliable wallets are distinguished.
- Cold. Cold wallets are storage on a personal computer or other physical media (for example, on a removable HDD). Thus, it becomes possible to obtain complete independence from the network service, as well as to have constant access to your funds, even if the laptop is disconnected from the Internet. Due to this functionality, all money will be fully protected.
- Online (network). This option is a site that acts as a storage service. There are a large number of similar storages for saving crypts, but experts recommend using extremely popular, proven, and reputable ones. One should highlight here, the main plus is the absence of the need to install and download the blockchains of the entire system. Also, the benefits include:
- no need to use memory on the hard disk in order to store network blocks;
- fast work of an online wallet;
- high level of security, provided that 2FA is enabled;
- the ability to manage storage anywhere, anytime (they do not provide for synchronization of installed programs and a personal computer).
- Electronic. Electronic (local wallets) are one of the reliable options for storing virtual currency. This method consists in pre-installing a specialized application on your own computer. There are two variants of such wallets - thick, thin. Thick wallets have a significant drawback - a large load on the entire blockchain on a personal computer. Based on all this, in order for this program to function normally, you need to take care of the availability of free space on your hard disk. As for thin wallets, this option is much better, since it does not take up all the free space on the system.
- Hardware. These wallets are a variation of the cold option. They are a physical device that has the function of storing all the private keys (and access) that are necessary in order to enter the vault at a remote distance without transferring this key to the system. Its size does not exceed the dimensions of a standard flash drive, it can act as a key fob that can be easily hung on the keys or put into the pocket of a jacket or small bag. With a hardware wallet for virtual currencies, the owner can be confident that the entire digital asset will always be with him. He will also be able to constantly monitor the balance, perform a number of transactions and other monetary transactions, regardless of location and time of day. The hardware wallet is the leader among all digital storage variations, which are an order of magnitude higher in terms of security, reliability, and ease of use. You can use the option provided in order to store one crypt or a large number of different currencies.
- Mobile wallet. A mobile wallet acts as a computer program designed to store its cryptocurrency in it. It is best to choose an application that belongs to the "thick" wallet. This is due to the fact that it is reliable, since the user can easily download a complete blockchain for himself. However, if you pay attention to practicality, then such an option is completely uninteresting and not multifunctional. That is, the user, if he left the house, will not be able to pay for goods or services, since in this case there is no key.
- Storing your cryptocurrency in exchange wallets.
It should be noted that the last point is the best crypto storage option. As in the case of wallets, the exchange provides for the generation of special key addresses, which represent a "number" for transferring funds and act as a random (random) digital and alphabetic set. Users who plan to perform a transaction procedure or other monetary transaction, including a money transfer, must request this address from the addressee and indicate it in the field where a personal number is required. The cryptocurrency will be transferred to the specified address, regardless of which network the addressee operates on, whether it is a wallet application or a personal account on the exchange.
In the first case, money will be exchanged between two wallets, and in the second, funds will be transferred to a cryptocurrency exchange. Apart from the names, these transactions do not differ significantly. The system operates in both directions. Users who have chosen an exchange as a storage must indicate the addresses to which they plan to transfer the crypto. It will be his address, or the address of another user who needs to be paid, does not really matter. The exchange will transfer the funds to the recipient, who will receive them in the same way as if the money were transferred from a local, non-exchange-type wallet.
How much is ChainLink in total?
The popularity of a particular cryptocurrency is determined by such a moment as how much ChainLink has been accumulated over the entire period of its existence. Immediately after decentralization took place, a large number of cryptocurrency exchanges provided users with the opportunity to become the owner of digital tokens on a one-to-one basis.
Today the capitalization of ChainLink is eighty-six million US dollars. Daily bargaining for the entire period was at least 630 thousand US dollars. With regard to tokens, it should be noted that today ChainLink boasts a figure of one billion Link, and 350 million Link tokens are in active circulation.
The creators of the project are Sergey Nazarov, Steve Ellis. The development of the network began five years ago, and the Initial Coins Offering was carried out only in September 2017. As a result, the team was able to raise approximately 35 million US dollars into the business. The total supply of ChainLink is quite limited - for only one billion Link tokens. During the Initial Coins Offering, developers were able to sell over 370 million digital coins, and this amount is planned to be distributed among the nodal operators. The remainder in the form of three hundred million coins is already in the status reserved by the organization in order to further develop the project.
Crypta ChainLink is operated as a reward paid to every user who provides information to the ChainLink system. Server developers believe that smart contracts have the potential to significantly improve a large number of existing industries. However, today the opportunity to obtain information from an external source is extremely limited. This problem can be easily solved thanks to the so-called "oracles". That is why the ChainLink system is trying to create a reliable, highly secured, dispersed oracle network, using the well-known technology called "Blockchain". Such a system makes it possible to provide a highly reliable connection of a smart contract with:
- a real source of information;
- various APIs;
- bank payment systems;
- key external resources.
ChainLink has two main parts:
In order to provide relevant, reliable information, these two components interact with one another. Blockchains select the oracle based on the parameters that are requested by the smart contract. The part called "off-chain" consists of oracle nodes that are connected to the Ethereum system, collecting data requested by users from outside. The information received is strictly processed thanks to a software called ChainLink Core.
Today, ChainLink is ready to provide a service that is fully compatible with such systems as Bitcoin, Ethereum, HyperLeger. A little later, the creators plan to add technical support, as well as other blockchains. ChainLink is already actively used by a number of leading teams involved in the development of smart (smart) contracts. It is also operated in a number of major organizations, including SWIFT, which is an international interbank enterprise that transfers information, as well as the execution of transactions and other monetary transactions.
What is ChainLink backed by?
A crypto called ChainLink (LINK) can rightfully claim to be the most successful digital asset based on the results of the current year. The token has been boldly and confidently adding for six months, and in recent weeks it has already been able to overcome the border of two US dollars. In just the last 24 hours, the crypto capitalization was able to increase to 640 million US dollars, given that the daily trading volume reached 160 million US dollars. If you study the charts provided by official sites, you will notice that ChainLink has been growing steadily since the beginning of 2019. The momentary increase in the currency began from the end of the last month of spring, and already in the middle of last month it was able to reach the highest peak of values. Since the beginning of this year, the token has managed to rise in price by almost 370 percent, which allows investors to safely invest and buy this asset.
The main driver of the tokens growth is the partnership with the Google search engine. At the beginning of this year, the ChainLink digital coin was listed on the exchange trading with a figure of $ 0.40, and at the beginning of the summer, it was able to come close to the two dollar mark. Experts believe that such an explosion of the token is directly related to the partnership between the developer and the Google organization, which will soon start using smart contracts based on the LINK blockchain. After the first notification about the partnership of cryptocurrency projects and Google, digital assets instantly jumped by 50 percent. The depositors decided to massively invest in a little-known token, as they could see great prospects in it.
"If an organization called Google begins to actively apply the smart contract based on the ChainLink blockchain in every industry of its business, then the dynamic movement of the price category of digital coins can maintain an upward trajectory," according to leading analysts. Already today, a large number of traders have decided to bet that ChainLink will be able to grow by at least 450 percent. But a number of specialists and investors nevertheless express their concerns. They are very worried that the crypt can turn into a "bubble" that can burst unexpectedly if it is pumped up for a long time and aggressively.
The future of ChainLink
The link, like the entire exchange market (you can read about the cryptocurrency market here ), is directly linked to the price category of the main cryptocurrency Bitcoin. If he decides to enter the next race, then ChainLink can count on the opportunity to participate in it. However, this is rather unlikely, so you should not expect that much can change for crypto in prices. That is, it should be noted that the future of ChainLink will be quite boring, with a lot of side effects, price jumps that will be directly related to Bitcoin.
Since the main currency in the virtual currency market is Bitcoin, it should be noted that Link is powered by bitcoins. If Bitcoin grows rapidly, then ChainLink will be suppressed. If, on the contrary, BTC falls, then LINC will be depressed in the event that the funds enter the Fiat format. If Bitcoin moves sideways, then it will force altcoin (ChainLink) to imitate this, as investors will wait for a specific notification about the direction of the exchange.
Summing up, it should be noted that Bitcoin is the center of the entire cryptocurrency market, and only with the help of the BTC trading pair on all exchanges, Link will not be able to avoid the severity of Bitcoin. Also, according to experts, many projects can fail significantly - a number of startups were created to raise money, so they can suddenly disappear due to the fact that they cannot cope with the competition.