With the increase in adoption of blockchain protocols and technology almost all around the world, it comes as no surprise that Google wants to make internet-hosted data available inside any public blockchain. Google has recently started moving towards this direction, making internet-hosted data available inside an immutable public blockchain. They have selected ChainLink, an Oracle based smart contract.
The project involves BigQuery along with ChainLink to accurately retrieve data. BigQuery is a service that works in conjunction with Google Storage to enable the analysis of massive data sets in an interactive way. BigQuery has several rich features including the ability to manage data based on a JSON-encoded schema, expressing queries in a standard SQL dialect, the ability to integrate with any Google App Script and the capability of sharing data sets with other arbitrary individuals, users or groups.
How will Google be Utilizing ChainLink?
Ethereum DApps request their data from ChainLink, which in turn gets its data from a web service built using Google’s App Engine and BigQuery. The data is retrieved from BigQuery when the DApp invokes the ChainLink oracle contract along with payment for the request to be serviced. ChainLink nodes, which are always listening in for these calls, can then execute the request. External Adapters, which are service-oriented modules, are then used to extend ChainLink’s capabilities to authenticate APIs as well as payment gateways and external blockchains.
In this case, Google implements a purpose built App Engine web service, using the App Engine Standard Environment. The App Engine is mainly chosen for its server less deployment capabilities, low cost as well as high scalability.
Two Use-cases Are Described in Brief Below:
1. Hedging Against Blockchain Platform Risk: The existing financial system has been completely reinvented through the integration of blockchain at various levels. It has undoubtedly made the financial ecosystem more transparent and trustworthy.
Many financial contracts such as futures and options have been traditionally used by companies to reduce or hedge their risk related to resources. Therefore, following the same principle, critical information related to on-chain activities such as average gas prices, are used to create simple financial instruments. These instruments can then provide payouts to their holders for certain circumstances such as when gas prices are too high.
Thus, the risks faced by DApp developers when it comes to block times and miner centralization can easily be reduced by bringing in high-quality data from crypto-public data sets.
2. Prediction Marketplaces: Normally, prediction marketplaces involve participants who have allocated capital to speculate on future events. Using crypto public datasets would allow even the most complex predictions to be settled successfully. Important information such as volume, recency and frequency of DApp utilization can easily be retrieved through one, seven and 30-day activity reports for a specific DApp.
What does this partnership mean for Link?
The effects on ChainLink’s value after the announcement by Google was almost instantaneous, with the price spiking over 75%, achieving a new all-time high of $1.95 for the cryptocurrency. This is reminiscent of Chain Link’s previous price spike in late 2017.Chain Link is currently valued at 1.98 USD as of 18/06/2019, with a marketcap of $692,444,638. It is currently trading in 55 markets across major cryptocurrency exchanges such as Huobi, OKEX and Binance.
ChainLink, which was created by Stele Elis and Sergey Nazarov, the creators of SmartContract.com, was launched back in 2017. Its primary purposes was to be the “secure” middleman, solving the various limitations of blockchain infrastructure such as security, reliability and other issues. After achieving several partnerships, this latest announcement has seen its value skyrocket, reaching rank 24th according to Coinmarketcap.
How Does Ethereum Play a Role In This & Why Is It Significant?
ChainLink as mentioned before, provides data from BigQuery public datasets on chain. This is entirely aimed at developers, providing them with newer capabilities to implement on Ethereum smart contracts. It also reduced inefficiencies which previously plagued the DApp landscape.
One of the most important usecases of this project include addressing limitations in the Ethereum network, such as using Submarine Sends to enable commit/reveals across the whole blockchain. One of the plaguing issues for Ethereum is its lack of transaction privacy which creates opportunities for hackers or adversaries through on-chain data leakage. This can be done through the Distributed Exchange addresses and front-running transactions. This problem of front-running transactions is a recurring problem in the Ethereum blockchain.
ChainLink solves this problem by using a ‘Submarine Sends’ approach, thereby increasing the privacy of their transactions. This prevents adversaries from “front-running” such transactions, thereby stopping such malicious behaviour.
Limitations of Submarine Send
Implementing Submarine Sends come with their own set of limitations when using without an oracle. This is because of the limit imposed by the Ethereum Virtual machine, which allow each contract to see at maximum 256 blocks upstream in the chain. This in turn limits the practical usage of Submarine Sends, creating unnecessary “denormalization” during rebroadcasting of data.
Why did Google Choose ChainLink?
ChainLink is a project that aims to solve the “oracle problem, which is a plaguing issue while smart contracts. ChainLink thus acts as a decentralised blockchain, present between the smart contracts and the oracles. The individual nodes of ChainLink can thus be considered as Smart contracts.
The main aim behind this venture is to interact perfectly with Ethereum DAppsthrough the use of ChainLink. Thus, Ethereum DApps could effectively request data from ChainLink, which in turn is collected from a Google App Engine powered web service and BigQuery.
Thus, this process makes it possible for Google products to interact with various decentralized applications. ChainLink, which acts as a data middleman, allows smart contracts to interact with a data source of BitQuery’s quality.
As indicated by their blog post, the main goal of this project is to provide an unparalleled level of interoperability. They aim to trade a small amount of latency and transaction overhead, in exchange for a large amount of economic utility. Thus, it is expected that the interoperability offered by this project will encourage developers to create hybrid applications, harnessing the power of both smart contract platforms as well as cloud platforms.
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