An On-Chain Analysis of Chainlink

Chainlink(LINK) has been one of the best performant crypto assets in 2019 and one that remains an enigma for most crypto investors. This is partly because Chainlink is not a general purpose cryptocurrency but rather a programmable token focus on one of the biggest use cases for decentralized applications(DApps): integration. While the performance of the LINK token certainly puzzles most crypto investors, most of the analysis has centered on its aggressive price movement and technical indicators. However, an analysis of it’s on-chain behavior reveals some very interesting insights that provide a more clear perspective of the future performance of this crypto-asset.

Explaining Chainlink in Two Minutes

Chainlink is a protocol to streamline the integration of external data into smart contracts. The core principles of the Chainlink protocol are based on the concept of blockchain oracles that combine the immutability of the state of the blockchain with the relevance of external data for on-chain smart contracts.

The core architecture of Chainlink is based on four fundamental components:

· External Data: This might represent an API or data fee containing relevant information to a blockchain programmable asset.