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- Chainlink’s Proof-of-Reserve brings stability and transparency to the stablecoin market while offering real-time insights into reserves.
- Chainlink’s CCIP will give smart contracts the ability to read and write data to other blockchains using cross-chain communication.
Oracle services provider Chainlink (LINK) continues to push further development and is looking to cater to other emerging market sectors. Global regulators are warming up to stablecoins and are ok with them in the financial system unless they don’t pose any major risks to global financial stability.
In its latest report, Chainlink mentions that stablecoins will serve as the core pillars of Web3. As the Web3 space matures, Chainlink expects stablecoins to make tens of billions of dollars worth of transactions every day.
#Stablecoins are a core pillar of #Web3, facilitating tens of billions of dollars worth of transactions every day.#Chainlink Proof of Reserve provides transparency into the assets backing collateralized stablecoins, helping increase user confidence.https://t.co/H2B0RLjep5 pic.twitter.com/f5M67pauRD
— Chainlink (@chainlink) February 27, 2023
Last year, Chainlink explained how its Proof-of-Reserve (PoR) mechanism helps in making stablecoins more stable by enhancing their stability and transparency. Besides, PoR can provide real-time insights into the stablecoin reserves thereby boosting market confidence.
Furthermore, with its decentralized oracle network, Chainlink can easily handle data transfers on-chain and off-chain thereby helping secure billions of dollars in value. Besides, oracles can also play a powerful role in delivering data across the multi-chain ecosystem.
One of the major drawbacks of existing stablecoins is that investors don’t have transparency and confidence regarding their reserves. With its Proof-of-Reserve, Chainlink seeks to address this matter upfront allowing anyone to verify that the stablecoin is backed by reserves.
Chainlink Total Addressable Market
The use of Chainlink’s decentralized oracle network pans across multiple industries with trust-minimized applications.
#Chainlink TAM.
That's the tweet. pic.twitter.com/Mqa0eXtPQR
— Harris Bell (@HarrisBell) February 24, 2023
The Trust Minimized Applications are a transition toward an ideal state wherein agreements between counterparties can execute exactly the way written. Furthermore, no participants can manipulate or back out from the pre-agreed terms. Chainlink notes:
This new type of cryptographic guarantee backed by decentralized infrastructure such as blockchains and oracle networks is generally referred to as cryptographic truth, and forms the backbone of trust-minimized applications.
The use of Trust-Minimized Applications will continue to grow going ahead. Its use and applications could be across multiple industries such as insurance, the stock market, global real estate, and much more.
The announcement from Chainlink reads: “Chainlink sits at the center of the service infrastructure layer for trust-minimized applications, providing access to key external resources including validated real-world data, off-chain computation, cross-chain interoperability, and much more”.
Chianlink’s Cross-chain Interoperability Protocol
Chainlink is currently the world’s largest oracle network with more than 2,000 integrations. This number is 1,7000 more than its closest competitor. In order to give strong competition to traditional players like SWIFT, Chainlink is now gearing up for the launch of its cross-chain interoperability protocol (CCIP).
The world’s largest oracle network now has 2045 integrations, that’s 1700+ more than its closest competitor.
Chainlink also has 86 node operators & 651,607 wallet holders.
March 2023: #SWIFT cross-border payments #ISO20022#Chainlink will launch #CCIP
IYKYK. 🔗 pic.twitter.com/26BY1trTA8
— ƊÓȠ. 2.0 (@Don_ChainLink) February 26, 2023
Chainlink’s cross-chain interoperability protocol (CCIP) will allow different blockchains to communicate with each other while giving smart contracts the ability to read and write data to other blockchains using cross-chain communication. This will likely prove to be a gamechanger in itself.
