Unique features of the Chainlink project that caught the attention of Google, PayPal, and SWIFT

The unprecedented interest in Chainlink (LINK) both from whales and private investors is due to the unique function performed by this revolutionary platform in the crypto market. In addition, the changing structure of the yield of leading virtual coins stimulates the rejection of conservative approaches to managing an investment portfolio. In this article, we will go over the features of this project so that you can build a Chainlink investment strategy with Gainy if you wish.

What is Chainlink (LINK)?

Chainlink is not just another coin duplicating the functions of major cryptocurrencies. It is not issued by a crypto exchange (unlike, for example, Binance Coin), does not use meme trends (unlike Dogecoin or Shiba Inu), and is not a stablecoin (unlike Tether or USD Coin).

Chainlink performs an extremely important function. Without it, it is impossible to achieve the maximum utility of blockchains and smart contracts. Chainlink connects them to the outside world and additional data that cannot be obtained in any other way. Such services are called oracles, and Chainlink is the most famous of them. LINK is the token of the Chainlink project.

Chainlink allows you to create many unique smart contracts that cover almost all areas of life and investment. For example, a farmer can receive additional insurance payments under a smart contract if the average temperature in his region exceeds 35 ° C. The farmer, accordingly, will also have to pay a certain fee to the partner company under the smart contract. If an insured event occurs and the average temperature exceeds a critical level (Chainlink will show this by providing data download from an independent and unbiased site), the farmer will receive a payment many times higher than his contribution. Here are the main advantages of such a scheme compared to traditional insurance:

  • there is no need for intermediaries – banks or insurance companies;
  • the contract will be executed instantly after the fulfillment of a certain condition or the expiration of the agreed period (without banking days and non-working hours) – always in 24/7 mode;
  • minimum commissions for participating parties;
  • the possibility of introducing additional conditions that will be acceptable to all parties and can be formally expressed using an algorithm;
  • maximum confidentiality and reliability of work.

There are other examples of using Chainlink for people:

  • betting on the results of sporting events;
  • change in the structure of crypto assets depending on exchange prices for oil, gas, coffee, etc.;
  • purchase/sale of virtual coins depending on the change in the discount rate by the Central Bank;
  • many other contracts linking cryptocurrency and foreign markets.

The connection between Chainlink and Ethereum

Chainlink functionality is implemented on the Ethereum (ETH) platform, and LINK has the ERC677 extension (one of the types of ERC20 tokens). This technological connection between crypto projects creates additional opportunities, but also creates some difficulties for Chainlink.

On the one hand, the popularity of Ethereum allows it to expand the number of users and investors. Most crypto wallets provide the ability to work with ERC20. On the other hand, scalability issues in the Ethereum network and a very high load that cannot be optimized before the launch of Ethereum 2.0 lead to some delays and high transaction costs on the blockchain. Therefore, many customers still cannot fully appreciate the full benefits of Chainlink.

At the same time, Chainlink is a completely independent project. It even surpasses Ethereum in using some innovative technical solutions. For example, Chainlink is successfully implementing the proof-of-stake transaction validation algorithm,

Proof-of-stake assumes that transactions are confirmed with the help of large holders of the LINK coin (so-called staking), and not with the help of miners, as happens in the Bitcoin network. Proof-of-stake provides additional benefits in terms of scalability and transaction speed.

Influence of whales, partner companies, and influencers

Large crypto investors show a tendency to increase their positions in the LINK currency. Moreover, they use the correction of the crypto market to maximize investments in the most promising assets. Therefore, they expect the value of LINK to rise in the long term.

Unlike the vast majority of altcoins, Chainlink has extensive business connections with companies and partners from areas other than the crypto industry. For example, Google, PayPal, and SWIFT use Chainlink and plan to expand their cooperation with this project in the future. Due to the fact that further integration of the cryptosphere with traditional financial and technology industries is inevitable, Chainlink’s competitive position may increase significantly, as well as the demand for the LINK cryptocurrency.

Influencers have a positive or neutral attitude towards Chainlink, which is very important for the stable and long-term development of the project.

Should you buy LINK?

Given the potential of the project and its achievements so far, the following conclusions can be drawn:

  1. The LINK coin should be considered a long-term investment with a planning horizon of several years.
  2. The establishment of historical highs will be possible only with a growing crypto market as a whole.
  3. LINK should be considered as an additional element in the crypto portfolio with the likely presence of BTC, ETH, SOL, and other leading cryptocurrencies.

Risks of investing in LINK

Despite the fact that Chainlink is quite an attractive project to invest in, there are still certain risks that should be taken into account. 

1. Crypto winter.

2. High concentration of coins among Chainlink owners.

3. Competing oracles.

Wrapping up

ChainLink is a fairly promising asset that can scale and be introduced into the real sectors of the economy. ChainLink allows businesses to use blockchain technology as efficiently and securely as possible, not only for processing transactions, but also for storing data and using it for corporate purposes. 

If you need qualified assistance in investing in the Chainlink project and the LINK token, the application from Gainy is a great way to assess the prospects for investing in this asset. Gainy technology uses innovative solutions to generate investment recommendations for both traditional assets and cryptocurrency assets.

Huynh Nguyen

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