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BIG CENTERED TOP HEADER: Smart contracts & the real world

HEADER PAGE 1: Enabling secure I/O into smart contracts & interoperability between blockchains


Smart contracts provide the ability to execute tamper-proof digital agreements which are considered highly secure and highly reliable. In order to maintain a contract's overall reliability, the inputs and outputs the contract relies upon also need to be secure. Chainlink provides reliable and secure end-to-end connections to external data.



Overview

	Historically, the blockchains on which smart contracts run cannot support native communication with external systems, and the potential that smart contracts provide have been throttled by their inability to connect to off-chain data, events, and payments.

	Today, the solution to this problem is to introduce a new functionality, called an 'ORACLE', that provides connectivity to the outside world. However, oracles to-date are centralized services, meaning any smart contract using such services has a single point of failure, which nullifies any benefits gained from the decentralized nature of smart contracts.

	To fill this gap, Chainlink (token sale in '17, launched in '19) was developed by SmartContract.com (founded in '14) as the first decentralized oracle framework that can provide external data to smart contracts on any blockchain. As a result, the security and determinism of smart contracts can be combined with the knowledge and breadth of real-world external events. Chainlink provides your smart contract with access to any external data needed to connect your smart contract with.

	You'll see Chainlink references in articles both as https://chain.link & https://smartcontract.com


What Chainlink has to offer

	Smart contracts require middleware to connect them to real-world data. Importantly, this data will trigger a contract’s outcome, thus creating the need for data inputs with high reliability and accuracy.

	No matter if you are a startup or a large enterprise, Chainlink as decentralized oracle middleware, can provide your smart contract with provably secure access to external data feeds, APIs and payments.

	Any developer can quickly build and launch their own Chainlink to sell any API (Application Programming Interface) to smart contracts while the data provider sells their API through their usual interface business as usual. By creating a new Chainlink as a developer, you’ll be paid by making something thousands of smart contracts will rely on.

	Larger enterprises can partner with Chainlink to offer existing APIs for purchase by smart contracts. Quickly and easily sell your company’s data and any of your other APIs using Chainlink. Provide countless smart contracts with the ability to purchase your services directly.


Partners & clients

	- 30+ Price Feeds on Ethereum Mainnet utilized by 14+ DeFi projects in production.
	- 100+ integrations including Polkadot, Synthetix, Loopring, Aave, Openlaw, Conflux, and more.
	- Partnered with large enterprises such as Google, Oracle, SWIFT, and more. 
	- Available in many development frameworks, specifically Truffle which is the most popular by far.
	- Chainlink alongside with Intel, Microsoft, IBM and others  are developing the "Trusted Computation Framework" (known as Hyperledger Avalon) allowing secure off-chain computations using TEE's like Intel SGX.

	 FULL LIST (updated until August 2019) of platforms, integrations, frameworks, clients & partnerships here
	 
	 (update with new April 2020 ecosystem chart here)

 
Use cases

	Access to external data enables an entirely new wave of functionality for smart contracts. Connected smart contracts have limitless potential covering a wide variety of industries:

		- Money and Finance
		- Payments
		- Insurance
		- Supply chain
		- Government
		- Enterprise Systems
		- Authorization and Identity
		- Utilities
		- Gambling
		
		Essentially almost any of the visionary use cases people came up with when being enthusiastic about Ethereum are dependend on data that is unavailable to blockchains. To name a few examples: derivatives of real-world commodities on smart contracts (link to google prototype), auto-rebalancing portfolio based on traditional trading indicators such as RSI and EMA, market-sentiment or even the network difficulty of Bitcoin, automatic insurance payout when a flight arrives late, triggering generic banking transfers based on smart contract outcomes, different types of lending products without middlemens based on overcollaterization or boni-score, bridgeing cloud infrastructure to smart contracts and more

		 A HIGHLY RECOMMENDED READ ABOUT USE CASES: 44 ways to improve your smart contract
 
 
bottom small reference: An API allows websites communicate with one another. CoinMarketCap uses a Binance API to fetch price/volume data every to display it on their own site. Uber was built using payments, GPS, SMS, and KYC APIs.
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HEADER PAGE 2:	Feeding decentralized blockchains with centralized data feeds is pointless
				Chainlink provides decentralized, reliable & tamper-proof I/O on ANY blockchain


Achieving decentralization

	Is it really possible to achieve truth in a world where you can’t trust your sources? Chainlink achieves this by being a NETWORK of oracles. Requested data is delivered by multiple oracles run by different independent node operators, using mutiple data source APIs, that are incentivized to provide proper data.

	By selecting several nodes and data sources, you provably increase the chances of getting a highly probable truth. Using Threshold Signatures, nodes aggregate their responses off-chain in order to reach an agreement before the final data point is sent to the smart contract on-chain. Furthermore, nodes are selected by reputation and previous performance. Hence, you ensure the smart contract’s security not only by selecting a high number of nodes, but also by selecting highly reputable nodes to feed data. See the Chainlink market.

LINK token utility

	The LINK token is used as payment and collateral to maintain the network security and incentives of the overall network. The token will be used for:

	Paying node operators for for delivering off-chain data to smart contracts.
	
	Node operators use LINK as collateral (stake) when required by contract creators in order to ensure they will behave correctly. Malicious or non-responsive nodes will have their collateral slashed & reduced reputation as a punishment.

	LINK is an ERC677-token developed specifically for Chainlink and integrated into Ethereum. ERC677 is an ERC20 token but adds TransferAndCall capability enabling payment and data retrieval within a single transaction.

	LINK is an Ethereum token but in the worst case scenario, it can be transfered to any blockchain platform. Chainlink is not limited to just Ethereum.


Chainlink Token Distribution

	There is a fixed quantity of LINK tokens: 1000M

	- 350M were sold at token sale (fundrasing and initial distribution of tokens).
	- 350M for incentivizing node operators through subsidies (solves chicken or egg problem of bootstrapping a new network).
	- 300M to SmartContract Chainlink Ltd (for continued development so they don’t take fees).

Why not just use ETH instead of LINK?

	Ties the incentives of node operators together with the health of the overall Chainlink network.
	Isolates the security and economic bandwidth (staked LINK) from external factors outside the control of Chainlink stakeholders.
	If a major network attack occured, LINK collateral then becomes worthless hurting the attacker, this is not true with an unrelated asset.
	Stablecoins won't work as they are either backed by fiat and thus censorable or rely upon oracles to function.
	Growing demand for LINK combined with a shrinking supply (due to staking) creates a positive feedback loop where the increased adoption boosts the price of LINK, thus increasing economic bandwidth and enabling more adoption to be supported. 
	Chainlink is blockchain agnostic and needs a token than can be easily bridged between blockchains.


If LINK is an ERC token, works only with Ethereum?

	No, Chainlink is blockchain agnostic. ANY developer can easily write an external adapter so they can call Chainlink from any blockchain. 


Blockchain agnostic

	Chainlink supports ANY blockchain. LINK was created as an Ethereum token but the Chainlink network can serve data to any platform.

	There are two ways to integrate Chainlink:

	1. Any developer can create a simple external adapter enabling any blockchain to request and receive external data from Chainlink nodes. Through this, LINK payments and staking collateral is still performed on Ethereum.
	
	2. The LINK token can bridged to another blockchain through LockDeposit contract enabling native LINK payment and staking support on any blockchain enabling applications outside of Ethereum to request and receive data without the need for  routing through Ethereum.

	Deploying Chainlink contracts in a new blockchain and bridging the token is a more complex process requiring cross-chain transaction support and therefore some simple data requests are likely still to be funneled through Ethereum for simplicity.

	Blockchains supported by Chainlink:

		- Ethereum
		- Bitcoin
		- Polkadot
		- Kava/Cosmos
		- Hedera Hashgraph
		- IOTA
		- Zilliqa
		- Any EVM-enabled blockchain
		- Many more

Customizing data & security

	Chainlink's flexibility largely comes from the "Service Agreement" (SA) model: Any developer can connect to or build an oracle network that fits their exact needs.

	Customization of a wide range of parameters:

		- Selection and number of nodes
		- Selection and number of data sources
		- LINK Node Payment amounts
		- LINK Collateral requirements
		- Minimum reputation requirements
		- Slashing conditions
		- Node certification
		- Threshold Signatures
		- TEEs ( See below “What is a TEE?” )
		- Mixicles

Open source & audited

	- Code is open source (here).
	- Development publicly traceable (here).
	- 4 independent audits:
	- 3 on main contracts (here). 		
	- 1 on Aggregator contract (here).
	- 1 on Mixicles (in progress).


Network usage

	Growth of Chainlink related smart contracts is an indicator of increased network utility & developer interest.
	(Image)


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HEADER PAGE 3: Permissioned or permissionless, public or private, all blockchains and DLT need a trustworthy oracle to be truly useful

- First mover advantage

	- First decentralized oracle framework.
	- Long-standing connections to industry leaders (Swift, Google, & Oracle), leading research consultants (Gartner & Capgemini) & enterprise consortiums (IC3, EEA, Baseline, & Hyperledger)
	- Network effects: Chainlink’s large number of clients, nodes & data sources attracts usage.


- Competitors

	- Direct: Alternative decentralized oracles which have little or no usage, inflexible and rigid customizability, have not yet reached critical mass, or is a homebrew and propritary oracle solution. This includes Band, Tellor, Witnet, Compound's OOS, Maker's OSM, and Doracles from iExec (integrated with Chainlink).
	
	- Indirect: Centralized oracle services like Orazlize/Provable (partnered with Chainlink) and Rhombus.

	New competitors will emerge and struggle to achieve marketshare since they will lack the large selection of nodes and data sources, subsidized oracle networks, time-tested security, first movers advantage, and network effects.
	

- Strong community

	- The Chainlink community is one of the largest, best educated, most creative communities in the crypto space, renowned for its meme art and comradery.
	- Official discord & gitter to reach the team.
	- An official Chainlink community advocate program exists in multiple cities and continents around the world. City list here.
	

- Team

	25+ person team
	6 advisors, amongst them:
		- T. Gonser (ex-CEO Docusign). Article
		- Ari Juels (co-creator Proof of Work)
		- Evan Cheng (Facebook R&D Dir & LLVM   author at Apple)
		- Hudson Jameson (Ethereum Foundation)
		- Andrew Miller (Consensus researcher)

	Currently, 11 open positions. Careers here
	No hype from the team, only professionalism.
	
	
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SECONDARY HEADER PAGE 3: A glance at the tech behind Chainlink

Together these innovative pieces of technology provide the most advanced oracle solution to date


1. Privacy & auditability: Mixicles

	Mixicles is essentially a mixer that uses external oracles to enable on-chain privacy for public blockchain smart contracts. The contract is split into two parts, where the sensitive data and business logic is kept off-chain with private settlement on-chain. Mixicles enable:

		- Private contract business logic, external oracle data & final payee result.
		- Financial contracts that are private to the public but auditable to regulators.
		- Blockchain agnosticism & can be used in enterprise blockchains as well. 
		- A new generation of privacy preserving and scalable DeFi instruments.

	Mixicles are currently under audit. Highly recommended article here. 


2. Low cost & scalable: Threshold Signatures

	Threshold signatures (TS) are being implemented in Chainlink which allows nodes to batch their responses off-chain substantially reducing transaction costs (gas) while minimizing the effects of blockchain network congestion. 

	How can this be achieved? Threshold Signatures pave the way to solving the oracle dilemma: One wants hundreds, thousands, even tens of thousands of witnesses to agree on a data point but that is expensive due to the growing amount of transactions needed.

	TS, enable oracles to talk to each other off-chain, agree on an observation, aggregate a single signature proving group observation, and then respond to the original data request using only a single on-chain transaction. Article


3. Trusted Computation Framework

	The Trusted Compute Framework (TCF) is way for enterprises to use trusted execution environments (TEEs) to secure off-chain computations to be used by on-chain contracts. Chainlink ensures that the data being delivered is encrypted and tamperproof end to end. 

	Typically computation takes place on-chain and is very expensive. TCF instead allows contracts to shift complex computations from on-chain to off-chain systems (on-premise or in cloud VM’s) and once finished post the results back on-chain all while keeping verification and attestation verification properties.

	Chainlink is part of the “Hyperledger Avalon Trusted Compute Framework” amongst Intel, IBM, Microsoft, Alibaba Cloud and Banco Santander.
	See Intel Press Release & Article.


4. Staking Collateral (Direct skin in game)

	In short, staking is when nodes delivering data to a smart contract stake a predetermined amount of LINK as collateral.

	In the case nodes fail to deliver a reliable data point, provides it in an untimely manner, or doesn't deliver data at all, they are penalized by getting their LINK collateral slashed hurting nodes financially.
	When nodes instead provide a reliable, timely data point to an oracle assignment, they are paid a fee in LINK and receive back their collateral. Article.

	This is how the Chainlink network incentivizes honest behaviour and penalizes malicious behavior of nodes.

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HEADER PAGE 4: Chainlink does not compete with any blockchain platforms, it improves them


DeFi & Chainlink

	DeFi (Decentralized Finance) is currently one of the fastest growing sectors in the decentralized ecosystem. DeFi consists not only of decentralized exchanges but also lending platforms and derivatives that run in a fully decentralized and trustless manner. The business model for the DeFi sector require 100% secure and accurate price feeds of all assets (90%+ of DeFi requires oracles). In DeFi, as in finance in general, security, reliability and reputability are all equally paramount for profitability. See this highly recommended article from team about DEFI. 

	Chainlink is currently providing the reference data for 36 assets or pairs like EUR/USD. Those price feeds are already being used by Synthetix (top #2 locked USD value), Aave, Ampleforth and under study by dy/dx (top #6). Data from: defipulse.com | exploring.link | reference ETH/USD


	Live platforms using Chainlink
	VALUE SECURED in April 2020

	Synthetix: Synthetic assets		$100M
	Aave: Lend & Borrow				$40M
	DMM: Real World Assets			$8M
	Ampleforth: Commodity Money		$5M
	Loopring: DEX Protocol			$3M
	BZX: DEX Protocol				$2M

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SECONDARY HEADER PAGE 4: Chainlink and the standarization process

Chainlink is involved in several iniatives in order to harmonize and standarize blockchain technologies


1. Enterprise Ethereum Alliance & Chainlink

	The Enterprise Ethereum Alliance (EEA) is a member-driven standards organization whose charter is to develop open, blockchain specifications that drive harmonization and interoperability for businesses and consumers worldwide. Chainlink has been in the EEA since 2017 alongside with very well known enterprises. In January 2020, EEA created the Mainnet Integration for Enterprises ‘EMINENT’ taskforce, spearheaded by Chainlink and others. The focus of this working group is to build open source available reference implementations and guidelines for Ethereum mainnet integration with enterprise “systems of record”. In other words,  the goal is to achieve an standard which allows connecting business backends (CRMs & ERPs) to Ethereum mainnet.	

2. Baseline protocol & Chainlink

	Baseline protocol, presented on March 2020 by big four Ernst & Young in collaboration with Microsoft, Consensys, AMD, Chainlink and others is an open source initiative that combines advances in cryptography, blockchain, and open standards to deliver secure & private business processes at low cost via the public Ethereum Mainnet. The protocol will provide a common framework to enterprises that enable confidential and complex collaboration between them without leaving any sensitive data on-chain. See press release here.

3. Hyperledger Avalon & Chainlink

	In Octoboer 2019, Hyperledger introduced Hyperledger Avalon. It is a ledger independent implementation of the Trusted Compute Framework. It aims to shift in a secure manner the on-chain processing to off-chain (Cloud). Avalon is designed to mitigate the drawbacks of on-chain computation (scalability & confidentitality). It offloads the chain, increasing performance while still keeping integrity and attestation. Chainlink alongside with other partners such as IBM, Oracle, Microsoft and others is working on the Avalon specification. Intel Press Release

* What is TEE? A trusted execution environment (TEE) is a highly secure, hardware based isolated computational space in modern CPUs, allowing for the execution of private  and attested computations, inaccessible to applications, the operating system, virtual machine manager, or even the computer’s operator.


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HEADER PAGE 5: Interesting Highlights

	- Chainlink has long been member of IC3, the leading academic research initiative for DLT and cofounded by Ari Juels. IC3 Members alongside Chainlink are JPMorgan, Microsoft, Cisco, Siemens, Intel.

	- About ISDA (International Swaps & Derivatives Association): On January 2020, BAPI was announced, a bilateral smart derivatives platform using technology such as a standard ISDA template, Ethereum, OpenLaw, Chainlink and Kaleido. It was co-developed by Carlos Matilla, Executive Director at Santander Investment Bank.

	- Chainlink is currently working with SWIFT, the global standard in interbank messaging. SWIFT is used by more than 11,000 financial institutions in more than 200 countries and territories, with over 32 million messages moving trillions of dollars each day.

	- In January 2017, Professor Klaus Schwab, Founder and Chairman of the World Economic Forum, wrote a book called The Fourth Industrial Revolution. In this book, Schwab describes SmartContract.com as the tipping point for the "Shift in action" under "Bitcoin and the Blockchain." (See here).

	- Chainlink is listed US regulated exchanges Coinbase, Gemini, and Kraken who offer LINK trading to New York investors. NYC financial security laws are some of the toughest in the world.

	- Chainlink acquired IC3's “Town Crier” oracle in order to expand the possibilities of their decentralized oracle network with native TEEs support. ( Forbes article | More info| * What is a TEE? )

	- Chainlink has two major marketplaces: 

		- market.link, created by LinkPool, is a marketplace that allows anyone to list their nodes, adapters and the jobs they offer. Anyone can see this list of nodes and filter by different criteria.
		
		- honeycomb.market, created by CLCG, allows developers to connect their smart contracts & decentralized apps to a wide variety of high quality paid APIs using multiple high-quality vetted Chainlink nodes from operators such as Certus.One, LinkForest & Cosmostation. Testnet APIs are offered free.


	- Even centralized oracles like ‘Provable’ can keep their business of selling their data as usual by creating an external adapter and selling data as another available source in the Chainlink network. Hence, they both earn money selling data their regular centralized way as well as via the decentralized Chainlink network.

	- This is the only remark regarding Chainlink as an investment: The Chainlink token LINK has been the BEST ROI investment asset in the top 100 of 2019, outperforming ALL other crypto assets, including Bitcoin. (See here).

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SECONDARY HEADER PAGE 5: Blockchains already supported by Chainlink

(Here comes an image)
(change to include Ethereum, Hyperledger, Bitcoin, Polkadot, Cosmos, and EOS)



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SPECIAL EDITION OF THE COMMUNITY FACT SHEET

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