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Cooking with universal gas
IYKYK ⛽️
Finance moving onchain is directly and uniquely bullish for Chainlink adoption, happy to explain
1. Chainlink has expanded far beyond price oracles. Saying Chainlink is primarily a price oracle would be like analyzing Amazon as primarily a bookstore, or Microsoft as primarily a spreadsheet software company. Chainlink is the only all-in-one platform offering data, interoperability, compliance, privacy, and orchestration, all core requirements for the issuance and distribution of institutional tokenized assets: nitter.net/ChainLinkGod/status/20…
2. As finance moves onchain, simply issuing a token on a blockchain is not sufficient. You need data oracles for NAV, corporate actions, reserve verification, etc. You need cross-chain oracles to transfer value and data between public and private chains (esp. as the cost of launching a chain drops to zero). You need compliance oracles for KYC/AML verification and various policy enforcements for regulated digital assets. You need privacy oracles to make data available onchain without revealing the underlying datasets/PII and while preserving data licensing restrictions. You need legacy-system oracles to enable institutions to access public/private chains through their existing enterprise systems and messaging standards. And you need orchestration oracles to enable institutions to establish complex business workflows that span multiple public/private chains, enterprise systems, and oracle services. Chainlink is the ONLY platform that offers all of these services, including packaged together into end-to-end solutions (e.g., DvP settlement, tokenized deposit workflows, etc.)
3. As for price oracles, as long as there are multiple trading/liquidity venues, multiple chains, and multiple CEXs, you need external price oracles that provide *full market coverage* by aggregating market data across all venues to raise manipulation costs. Otherwise, you introduce a significant attack vector. We have seen time and time again how using a single DEX pool as a price oracle has led to a dApp getting exploited/manipulated/rekt. There's no way to know whether a DEX/liquidity pool will keep consistent liquidity over time. As new DEX models appear and new trading venues launch, a pool that is liquid enough to use as an oracle today can be dangerously manipulable tomorrow as liquidity shifts. That is why Chainlink data has powered the vast majority of DeFi for the past 5+ years. Liquidity moving between venues becomes a non-issue, and builders can focus on their core business logic instead of building and maintaining price oracles
Watch @Chainlink's presence at Swift's @Sibos conference next week, it should be very enlightening about why some of the world's largest financial institutions and market infrastructures have adopted Chainlink infrastructure
Btw respect the takes you give on L1 chain commoditization/overvaluation, I may not agree with where capital will flow or what L1 assets will reprice to, but this thesis is obviously a blind spot and emotional topic for many market market participants
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Chainlink is constantly moving with the biggest power players in the world defining the future of finance.
They will determine how onchain finance reaches scale, and Chainlink will be critical infrastructure powering it.
Bullish $LINK
NEW: CHAINLINK AT THE FEDERAL RESERVE
@SergeyNazarov joins leaders from BlackRock, Vanguard, and Sharplink on the trajectory of blockchain adoption across traditional finance at the Federal Reserve Fintech Conference ↓
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Not a bad day to learn about $LINK
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4. Economics
Chainlink has one of the largest value capture potentials of any project. This stems from several network features, including:
Multiple services
They have five main verticals of services, often with multiple types of services within those verticals.
This means there are five buckets in which they can earn fees from users, with many projects using multiple services and increasingly more powering their entire app on Chainlink.
Any chain
Chainlink can be accessed on any blockchain, meaning it can earn fees from institutions and apps across any public and private chain.
DeFi and TradFi
Chainlink services are critical to Web3 native apps, asset issuers, and products built by the world’s largest institutions. Anyone is a potential customer.
Payment Abstraction
They’ve built a system where users can pay in a variety of ways, such as gas tokens, stablecoins, and offchain in fiat, with those fees then programmatically converted to LINK on the backend.
This makes LINK core to the usage of Chainlink, and aligns with the industry shift toward payment abstraction.
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Learn more about current industry dynamics and how Chainlink is positioned by listening to the CLG Podcast where we discuss it. open.spotify.com/episode/0kh…
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⬡ The_Crypto_Oracle ⬡ retweeted
NEW: Bottomline, a top-three Swift service provider moving $16+ trillion in payments annually, has launched Global Pay Connect, a new onchain payment connectivity platform for 600+ banks powered by Chainlink.
@bottomlinepay and Chainlink are now giving financial institutions a direct path onchain at scale.
Chainlink extends Bottomline’s platform to blockchain networks through secure interoperability & orchestration infrastructure:
→ CCIP connects Bottomline's payments infrastructure to blockchain networks through a single, network-agnostic integration model.
→ CRE coordinates end-to-end payment workflows across onchain & offchain systems.
The result is that institutions can reach onchain payment rails through the Swift network & payment messaging standards they already use, without replatforming or building a bespoke integration for every network.
The infrastructure powering global payments is connecting to the onchain economy through Chainlink.
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Institutional chain launches on day 1 with 4 Chainlink services.
Arc itself sponsored those services for its users via Scale, which tells me Arc knows Chainlink is key to its chain's success.
NEW: @Arc, the L1 chain developed by @circle, launches on mainnet with Chainlink services live from day 1.
Through Chainlink Scale, Arc is making a substantial capital commitment to provide its ecosystem cost-efficient access to institutional-grade oracle infra:
• CCIP
• Data Feeds
• Data Streams
• Proof of Reserve
Arc 🤝 Chainlink
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⬡ The_Crypto_Oracle ⬡ retweeted
🚨 NEW info just dropped about why the Wyoming government deprecated @LayerZero_Core and migrated $FRNT to @Chainlink CCIP 👀
And it doesn’t look good 🤦♂️
According to @LawhornKA, CISO of the Wyoming Stable Token Commisison (@wyostable), the Commission conducted an extensive review of LayerZero Labs’ security posture and access-control processes
From this review, they discovered a repeated pattern of major operational security failures at @LayerZero_Labs, including:
- the failure to maintain proper control of a critical private key used to manage a live production FRNT deployment (!!)
- a recent access-control issue in which the company failed to transfer a production authorization to the Commission
- inadequate disclosures provided about incidents, both public and private
Yes, you read that right, LayerZero Labs lost control of a private key used to manage a live production deployment of the Wyoming state government’s stablecoin
This massive issue is in ADDITION to the $292 million LayerZero exploit, in which hackers affiliated with North Korea (DPRK) breached LayerZero Labs’ infra
And in addition to LayerZero Labs’ mismanagement of 3 production multisig keys that were engaged in non-multisig related activity (incl “McPepes” memecoin trading) on their production 2-of-5 Gnosis Safe multisig used to manage billions in user value
TL;DR: Based on all available public information, @LayerZero_Labs has one of the worst operational security track records in the entire blockchain industry and should be never allowed to touch a multisig private key ever again
The Wyoming Stable Token Commission conducted a comprehensive review of the cross-chain infrastructure. We then evaluated LayerZero against Chainlink CCIP and other alternatives across six dimensions. Our findings are outlined below.
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If you are a serious DeFi protocol, asset issuer, or institution, proper due dilligence will always lead you to CCIP over other cross-chain solutions.
If we are a serious industry, we need serious infrastructure that prioritizes security. Just take it from the State of Wyoming, who learned first hand the inadequacies of other solutions.
"It was discovered that the company (LayerZero) also failed to maintain proper control of a critical private key used to manage a live production FRNT deployment. We were also concerned by the inadequate disclosures provided about incidents, both public and private. For a public issuer responsible for safeguarding state-backed digital assets, that pattern is not acceptable."
The Wyoming Stable Token Commission conducted a comprehensive review of the cross-chain infrastructure. We then evaluated LayerZero against Chainlink CCIP and other alternatives across six dimensions. Our findings are outlined below.
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We're back!
Check out the latest CLG podcast where we give our honest thoughts on the current state of the crypto industry and where #Chainlink ($LINK) fits into it.
🚨 New CLG Podcast is live 🚨
Two years since our last episode, @Crypto___Oracle and I discuss how institutional adoption is reshaping crypto and who will benefit as tokenization scales
This one was long overdue
Link in the next tweet 👇
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