Friday, July 30, 2021
DeFi Avalanche to Include Data From Chainlink

Avalanche to Include Data From Chainlink

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Avalanche, a blockchain-based platform used to launch apps, has incorporated data feeds from Chainlink, an “oracle” network, which is a service that brings data from outside sources into a blockchain.

Smart contracts with external data, such as prices, piped in are powering a growing decentralized finance (DeFi) economy of lending apps, decentralized exchanges and price-sensitive derivatives markets. DeFi refers to apps that allow people to conduct financial transactions without a traditional intermediary such as a bank.

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Those apps, known as dapps, are being built on the Avalanche platform that went live in September. Avalanche is similar in some ways to other base-layer blockchains like Solana and Binance Smart Chain, but with a novel consensus system and better compatibility with smart contracts that run on the Ethereum platform.

Adding Chainlink data feeds to the mix will kickstart a DeFi ecosystem on Avalanche, said John Wu, president of Ava Labs, the company that runs Avalanche.

“There are over 225 projects building on the Avalanche ecosystem, many of them in integration mode, waiting for some functionality such as oracles from Chainlink,” Wu told CoinDesk in an interview. “Some large stablecoins are also shortly down the pike. So this is why we’re so excited.” 

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Historically, DeFi and blockchain oracles emerged at about the same time, said Chainlink co-founder Sergey Nazarov. 

“That’s not a coincidence,” Nazarov said in an interview. “The dynamic around DeFi is that you really can’t build it without external data. DeFi is what we call ‘a hybrid smart contract,’ in the sense that it combines on-chain code and off-chain systems.”

The Chainlink network is a collection of many services that provide data on a wide range of areas from prices to weather to gaming, Nazarov said.

“The industry was about this one smart contract for tokens. Then it moved to tokens plus voting, and then to tokens and voting using external data,” Nazarov said, adding: 

“So tokens are like the unencrypted email of our industry; they are the beginning. Now we are opening the entire universe of what you can build.”

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