Chainlink 2023 Look Ahead Summary
The following is a summary of Sergey Nazarovs “Chainlink Network in 2023”
Sergey starts with thanking the community and touching on the wildly volatile period the last few years have been. He points out that verifiable trust can help protect users against insolvent exchanges. This naturally leads into…
The recent mass adoption of proof of reserves is one clear example of how rapidly our industry and even the larger global economy can switch from being comfortable with the unverifiable promises of a well-known brand (e.g. FTX), to requiring a form of cryptographic truth (e.g. verifiable proof of reserves) as the new minimum for using an application at all.
Sergey talks about continued interest from various smart contract platforms as well as legacy enterprises. He then moves into some Chainlink statistics…
$6.9+ trillion in Transaction Value Enabled (TVE). TVE is the sum of the USD value of all transactions enabled by a protocol.
5.8+ billion data points delivered on-chain.
700,000+ verifications of off-chain and cross-chain reserves.
1,600+ projects in the Chainlink ecosystem.
1,000+ oracle networks launched.
10.5+ million randomness requests served.
18,000+ public GitHub repositories using Chainlink.
19,000+ SmartCon 2022 attendees (in-person and virtual).
Chainlink Economics 2.0 is the title of the next section in the article.
Chainlink Economics 2.0 is the beginning of a new era in increased oracle security, sustainable value capture, and long-term adoption for the Chainlink Network. Economics 2.0 consists of an array of initiatives, including the Chainlink BUILD Program, the Chainlink SCALE Program, and most notably, Chainlink Staking.
Sergey quickly moves into the next section. “Expanding the Chainlink Network Monetization Model”.
Beyond Chainlink BUILD, SCALE, and Staking, a new Economics 2.0 initiative is the expansion of the Chainlink Network monetization model. This may encompass fee-sharing, usage-based fees, or subscription models for dApps and protocols that use Chainlink services.
Importantly, Sergey notes that establishing a strong monetization model will benefit both the security as well as long-term sustainability of Chainlink. He also notes dApps will now be able to pay more for better service allowing them to differentiate themselves amongst the competitive landscape. Next, the Chainlink BUILD program is mentioned along with the ability for stakers to earn BUILD participants tokens who contribute from their token supply.
Sergey next touches upon “Enhancing the Chainlink Network Payment Model”…
In order to support an expanded monetization model, we are in the process of architecting an enhanced payment model across Chainlink services. The goal of this initiative is to make payment significantly easier for dApps and developers that consume Chainlink services, resulting in users paying more fees to Chainlink service providers. To minimize friction in collecting fees, payments can be made in LINK, or in certain cases, in other assets, including native tokens, at a higher rate compared to LINK payments. Payments in other assets can then be converted into LINK, resulting in a total increase in LINK consumption.
Following this is a section titled “Exploring Market Demand for 2023”. This section is broken down into data points stating the three main categories of market activity they are focusing on…
Moving information/market data and commands/event messages from traditional systems into blockchains, effectively making Chainlink a key conduit for all commands and information both to and from all blockchains.
Connecting all blockchains into a large interoperable network for both value transfer and smart contract interoperability. Developers should be able to connect smart contracts across multiple chains, just like they connect code across multiple clouds.
Adding key off-chain computations that make advanced trust-minimized applications possible. Existing examples are VRF, Chainlink Automation, and zero-knowledge proofs with DECO, with many additional types of computation being worked on.
After expanding on these points and explaining the thought process for focusing their brain power here, Sergey moves onto showing some real world examples showcasing how and why these priorities are important. The increasing amount of real-world assets being tokenized can be used to generate rewards, serve as collateral, and support derivatives. Sergey believes Chainlink holds a key position in the tokenization “mega-trend”. CCIP will have a phased launch process throughout 2023.
We know many have been eagerly anticipating the launch of CCIP. Security is our number one priority for CCIP, as it is for every Chainlink launch. We appreciate your patience and understanding and look forward to releasing CCIP in 2023 in a state that meets the functional and security demands of the growing cross-chain economy.
Sergey then expands upon Proof-of-Reserves specifically pointing out FTX and their collapse. Next Sergey talks about “DeFi Derivatives and Low-Latency Data”. On-chain derivatives require low latency data.
This next generation of oracle architecture can reduce update latency by multiple orders of magnitude while also significantly reducing oracle network operating costs by moving the gas costs of publishing oracle reports on-chain to users and helping protect against harmful MEV practices. The DeFi derivatives market will increasingly be an area of focus as we move into 2023.
“Expanding Trust-Minimized Off-Chain Computation”…Chainlink will be expanding their trust-minimized off-chain computing capabilities throughout 2023. Sergey expands upon a wide range of use cases this will unlock as developers continue to utilize Chainlinks products.
Finally, Sergey talks about Chainlinks need to adapt. As the market shows a need for certain products (CCIP) other products take a back seat in development(trusted hardware). Sergey says they are working towards additional transparency in their decision making on how and why certain initiatives are taking place.
Finally…
I’m deeply grateful to everyone in our community who understands what we are seeking to achieve by enabling a new era of cryptographic truth. Thank you for productively working with us to create this significant change in how the world will work.