Between blockchain and reality: Based on the Ethereum blockchain, the protocol created in 2017 allows real-world information to be stored and transmitted in a secure and decentralized way. The goal is to connect real-world data with smart contracts embedded directly on the Ethereum blockchain to simplify transactions between users. The technology consists of a network of oracles that allows reliable data from the real world to be fed directly into smart contracts so that they can be used in various decentralized applications. For example, it could allow for the integration of weather data from certain geographical areas to run insurance policies.


The protocol has its own token: LINK. The token is used as for many crypto assets to pay the operating costs on the network. The oracles are used to authenticate the veracity of the data provided. The data can be for example the outside temperature, the score of a soccer match, the result of a vote, an economic statistic etc. All these data will be verified with different sources to ensure their authenticity. Thus Chainlink connects the "on-chain" world (on the blockchain) and the "off-chain" world (information outside the blockchain).