Ethereum Classic Labs is excited to announce our collaboration with Chainlink to bring decentralized oracles to Ethereum Classic.
Ethereum Classic & Ethereum do not natively interact with off-chain services due to the underlying consensus mechanisms that maintain specific behavior in the network, particularly determinism. In this regard, blockchains can only process transactions in a deterministic manner using on-chain data.
While this leads to heightened levels of security, it comes with certain limitations, such as not being able to connect with other blockchains or non-blockchain infrastructure. Thus, developers are unable to connect their smart contract applications with market data for DeFi, IoT data for insurance, traditional payment systems for settlement, and more.
Oracles solve this problem by creating a bridge between blockchains and the outside world. Oracles enable this off-chain connectivity for the smart contract by reformatting external connection points (APIs) so that two different software applications are compatible for data exchange. The oracles can then pull data into the smart contract and/or execute actions on external systems based on pre-defined instructions.
Chainlink can give smart contracts access to data providers, web APIs, enterprise systems, cloud providers, IoT devices, payment systems, and other blockchains. Importantly, Chainlink is a proven decentralized oracle network, which allows Ethereum Classic smart contracts to interact with off-chain resources with the same security guarantees as the underlying blockchain. This is critical because smart contracts are only as secure as their weakest component, meaning that a fully decentralized smart contract is potentially insecure if it’s triggered by a centralized oracle.
Chainlink alleviates these concerns by bringing decentralization to both the data source and the data retrieval process. Developers can decentralize the data source by fetching data from multiple data providers, such as retrieving cryptocurrency prices from multiple data aggregators. Additionally, developers can decentralize the data retrieval mechanism by having multiple independent Chainlink oracles fetch the same data point to ensure one oracle isn’t a single point of failure.
“This extended functionality to off-chain environments substantially scales the number of use cases smart contract developers can create using Ethereum Classic and ultimately makes it easier and more seamless for developers to build on Ethereum Classic,” said James Wo, Founder of ETC Labs.
One such use case is providing DeFi applications on Ethereum Classic secure and reliable access to the ETH/ USD price via their Price Reference Contract. This reference contract consists of 21 independent Chainlink oracles that each submit a price that gets aggregated and submitted on-chain. This use of aggregated data provides a robust canonical result that can be queried and utilized by users or DeFi projects.
With the growth of ETC and ETC-ETH compatibility, supporting Chainlink use cases on ETH is important to our infrastructure. Stay tuned for more integration updates with Chainlink and sign up for our newsletter here to get the latest news on Ethereum Classic!
Chainlink is a decentralized oracle network that enables smart contracts to securely access off-chain data feeds, web APIs, and traditional bank payments. Chainlink is consistently selected as one of the top blockchain technologies by leading independent research firms such as Gartner. It is well known for providing highly secure and reliable oracles to large enterprises (Google, Oracle and SWIFT) and leading smart contract development teams. Learn more by visiting the Chainlink website, Twitter or Telegram. If you’re a developer, visit the developer documentation or join the technical discussion on Discord.
About ETC Labs
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ETC Labs is focused on the advancement, development, utilization, and adoption of the Ethereum Classic community, core technology, and ecosystem through ETC Core and the ETC Labs Accelerate incubator program.