Spotlight Series: Paralink Network
By Daniel Dal Bello, Director.
May 27, 2021–3 min read.
Paralink Network (‘Paralink’) is a Polkadot-based multi-chain oracle platform building on the shortfalls of incumbent solutions that will be vying for a parachain slot within the Polkadot ecosystem. Hillrise Ventures is an early supporter of Paralink Network.
In this post, we introduce and highlight the Paralink Network ecosystem and product offering.
Parachain auctions on both Polkadot and Kusama are now in full swing. Acala Network won the first slot auction on Polkadot testnet Rococo, followed on by Litentry, Phala Network, Darwinia Network, Bifrost and Plasm Network.
This is an exciting time for the project having made significant progress while the Polkadot ecosystem moves along at full steam. This project endeavors to be a part of the next generation of blockchain oracles to support a new phase of DeFi startups.
Oracles are a fundamental underlying building block of the blockchain technology stack as they provide smart contracts across all protocols with external information. Along with the ethos of the space, decentralised oracles are important to remove any counterparty risk and increase data reliability. Paralink serves this segment and brings along its own set of unique tech and functionality.
Paralink Nodes are ideally run by self-organizing groups of node operators, servicing data requests to earn fees. With a consensus mechanism involved, slashing is thus in play as a means to penalize deviations or missed requests.
The node structure in Paralink has been designed with flexibility in mind, offering 3 types of models with increasing security to satisfy a variety of needs/applications:
- Simple Oracles fulfill an oracle’s basic jobs cheaply and quickly but at the cost of having to trust the node operators;
- Trusted Oracles integrate with reputable data providers yet are able to remain cheap and fast, but are exposed to single points of failure;
- On-chain consensus allows applications to request data from multiple sources, guarantee robustness and data quality, yet requires the use of bridges and is intrinsically more costly.
Such a variety of nodes contrasts heavily against current oracle providers that typically only have a single subset of node.
Paralink Query Language (‘PQL’)
PQL was developed specifically with ease-of-use in mind for developers — data requests are made via PQL definitions (JSON-based ETL descriptions) and queries are conducted via a familiar SQL-like interface.
Being a multi-chain data ingress, it is able to address the limitations of current oracle products. That means being versatile enough to get data from any real-world APIs, databases or blockchains, without giving up any data integrity or security.
With their recent integration with Binance Smart Chain, users could soon benefit from exposure to PQL’s functionality in a fast EVM-based environment.
Certain applications like blockchain-enabled gaming and gambling require a randomization factor to make sure that their application is fair, and can’t be gamed through returning patterns by users.
While most solutions rely on software (complex algorithms), Paralink’s solution relies on a proprietary, yet-to-be-unveiled hardware-based source of entropy.
Furthermore, other providers tend to use on-chain verifiable randomness, which can be expensive and can still be read by one entity. Paralink’s hardware-based solution guarantees the highest level of entropy at an affordable price which in turn makes for cost-effective solutions for projects.
Oracles are only as good as both the quality of its data provisioned and the platforms that want to use the data. Paralink has been making significant progress with the latter, partnering with at least 7 projects including Litentry and Plasm Network — both of which have managed to win parachain slot auctions. This gives Paralink a strong ability to work with these teams and continue building, without the project having won its own parachain slot as of yet. This undoubtedly gives Paralink a significant leg up on its competitors vying for market share in this new ecosystem.
The PARA token is key for both governance and on-chain coordination — paying for gas costs of callbacks and as a fee for data requests. As a node operator, PARA also grants ownership rights of their respective quorums (for revenue splits). You might imagine that as Paralink’s usage grows, value will continue to accrue to token holders in a similar manner to other oracles, but holders will certainly benefit from higher volume (from lower fees).
Hillrise Group supports ambitious Web3 startups with early-stage venture capital and fundamental research.
Paralink is a substrate-based multi-chain oracle platform for DeFi applications and a portfolio company of Hillrise Ventures.