Chainlink strikes again with another milestone. Earlier this year, we saw the Alpha release of Functions, followed closely, in July, by the release of CCIP on both testnet and mainnet. Now, a few months later, the Beta release of Functions on mainnet; refined and improved. A new product: Data streams, which is already being used by GMX on Arbitrum, and available in early access for developers. Incidentally, it comes packaged with Automation 2.0, which allows, among others, for much cheaper computation. Oh, and the Developer Hub as well.
An impressive streak.
These services are indicative of Chainlink’s commitment to make blockchain a hands-on reality for both developers and users; technologies that are secure, reliable, and accessible. Consequently, their recent partnership with SWIFT, the global provider of standard financial communication services, consolidates their presence in both blockchain and traditional financial systems.
I’ve been exposed to Chainlink since a hackathon in Fall 2022, and I got to try out the first versions of Functions, as well as most of their products extensively across projects. I can’t help but share my excitement and perspective on the large potential this brings to blockchain and smart contracts.
This is not a shill or “pump my bags” post; I have no affiliation with Chainlink. Only a genuine interest and a strong enthusiasm from a developer’s perspective, with a keen focus on security, robustness, and accessibility. Which I want to share, as I believe in products you can actually use and benefit from. I’m convinced that there is no stronger bet, as a developer, than getting involved in their ecosystem as early as possible.
0 — TLDR;
Allow me to provide you with an early summary of what you should understand from this post, if you don’t have the time, or don’t feel like reading it.
Chainlink is not pushing for mass adoption, and they are not trying to onboard users. They are not working to deliver short-term value or aggressively incentivize people to use their services in the promise of an airdrop. They are not building a new infrastructure, a new blockchain, not even a new system.
This is kind of unusual in this industry, as we’re used to projects spanning during the night, raising absurd amounts of money, and employing all the points mentioned above; all of this in the span of a few months.
What Chainlink does, essentially, is leveraging blockchain to improve technology that already exists; I mean, in the real world. They are delivering and iterating over actual products, meant to be used by financial institutions from both worlds, and integrated with their existing infrastructure. This is not only convenient, but also necessary, as we can’t expect each one of them to (re)deploy their entire system on a new blockchain, whenever they want to integrate with a product.
Fundamentally, they are gradually establishing a secure framework for integrating with crypto assets — from a traditional perspective. One that can be trusted, reused, and standardized.
Interestingly, they are actually driving mass adoption, just by consistently delivering tangible value, thus maturing the industry and technology one release at a time.
On a side note, The Developer Hub is the epitome of precision, clarity, and comprehensive information; Chainlink sets the highest standards of quality in every detail, and the documentation/education is no exception to it.
1 — CCIP: The cornerstone for financial institutions
The introduction of CCIP is not just a technological advancement but a silent revolution in both traditional and decentralized finance.
We all know how easy bridges tend to get exploited, either by being manipulated or because of a logic bug. Good news everyone, this is not a bridge.
CCIP is a tangible solution that is tailored to seamlessly integrate with the existing infrastructures of financial institutions. And I would like to emphasize once again: it doesn’t boast a chain or focus on settlements. Instead, it provides a sophisticated and streamlined mechanism for the transfer of value and message across chains, thereby facilitating tangible outcomes.
The acquiescence of reputable entities, such as SWIFT, is a clue that the concept of blockchain is transcending its theoretical appeal to embody practical and scalable applications. We often talk about mass adoption, value flowing in, new user bases accumulating; this is not something you can actively do, or provoke, but something that can be expected when a technology is mature enough. Meaning secure, accessible, robust… and useful.
When most companies in blockchain are still focusing on building infrastructure, and you have a 6% chance of losing your money after interacting with a protocol, it doesn’t really look like a mature industry. But when a well-established blockchain company lands partnerships with major traditional finance institutions, it does look like it is eventually maturing.
From a phase of speculative assertions to the point where DeFi will not only coexist but improve the operational efficacy of existing financial systems.
2 — The backbone of Web3
Again, Chainlink’s intention is clear: to not merely release products, but to shape industry standards.
As developers, it’s crucial to consider the security and integrity of the systems we build. Chainlink’s suite of products provides a comprehensive solution — framework — to address many of the vulnerabilities inherent in decentralized applications. This is demonstrated in their approach to integrating external data sources, automating logic-based tasks, facilitating cross-chain interactions, and now streamlining contract-based interactions, ensuring low-latency data delivery and automated trade execution. (pause)
These tools not only help in ensuring that blockchain is ready, robust, and applicable in the real world, but also provide a much-needed consistency across projects, which is the essence of a framework.
On a side note, it’s also essential, as always, to keep a balanced view. While Chainlink provides solutions to many challenges, it’s crucial to understand that it still requires careful implementation and continuous monitoring to ensure the utmost security and efficiency. Using Chainlink does not necessarily mean that it is safely and efficiently implemented.
3 — Functions, or how to actually bridge the gap
Functions are an accurate representation of literally bridging the gap, from a developer’s perspective.
Chainlink’s documentation, especially the Overview and Getting Started guides, are always meticulously crafted, ensuring a seamless experience for developers. That is the case with the documentation for Functions, as well as the interface for managing subscriptions, which is consistent with their other offerings and is both intuitive and user-friendly.
But there is much more to it. Functions enable a simplified and efficient access to trust-minimized off-chain computations through a Decentralized Oracle Network (DON). This eliminates the trouble of running a personal Chainlink node, which has a significantly higher learning curve.
During my initial exploration in its early stage, the clarity and ease of integration it offered stood out. What previously took a week’s time to understand with Chainlink nodes, jobs and external adapters was reduced to mere days with Functions; even though it still required some dedication.
Now, the process has been further refined. The interface facilitates the creation and management of subscriptions, thus contributing to a more streamlined experience. The meticulously detailed documentation, complete with step-by-step tutorials, simplifies the learning process, making the assimilation of the product into actual projects more straightforward and less daunting for developers.
Essentially, and as a key point, the integration of various components into a unified environment drastically cut down the associated complexities, without sacrificing security or transparency.
And this is essentially what the team at Chainlink Labs is doing.
4 — Closing thoughts
I often approach big companies and institutions with a hint of skepticism, especially when they grow into major entities.
However, my reservations are tempered when their track record is only made of actual, security-focused products with real and practical use cases, consistently over the years.
It’s one thing to appreciate a company’s intentions, but here, speculation takes a backseat to tangible, positive outcomes that Chainlink consistently delivers to this space.
References
- Max Melcher, on the new features of Functions Beta on mainnet, Twitter, 2023–10–02;
- Chainlink, on the release of Data Streams on Arbitrum, Twitter, 2023–10–02;
- Sergey Nazarov, on overcoming blockchain integration challenges in global finance with CCIP, Twitter, 2023–09–22;
- polarzero, “Why you should use Chainlink as a developer”, Twitter, 2023–07–21;
- ChainLinkGod, on the new capabilities CCIP brings to the table, Twitter, 2023–07–18;
- Patrick Collins, on DeFi’s TVL and how/why it would go up, Twitter, 2023–07–12;
- polarzero, a few thoughts after trying out Functions during Alpha, Twitter, 2023–03–04.
