Chainlink – a blockchain oracle service provider – now has over $60 billion deposited into smart contracts. A recent analysis from Bank of America claims that the network will drive blockchain adoption across the gaming, gambling, and insurance industries, among others.
Chainlink Driving Defi Growth
According to a research report released on Wednesday, the firm believes Chainlink is currently a likely driver behind growing total value locked in decentralized finance (DeFi). According to DeFiLlama, there is now over $205 billion locked in DeFi – up over 300% year over year.
Defi refers to the provision of financial services such as insurance, borrowing, and lending through blockchain-based smart contract systems, rather than through traditional centralized systems like banks. Ethereum – upon which Chainlink is built – is currently the leading blockchain for Defi, holding $121 billion TVL.
Chainlink is what’s known as a blockchain “oracle” – a device that connects on-chain and off-chain data. These allow smart contracts to execute based on inputs from the real world, rather than just blockchain-native variables. Its growth was exponential last year, scaling up from just $7 billion in TVL at the end of 2020.
The report credits the “ability for hybrid smart contracts, or self-executing and tamper-proof digital agreements, to verifiably and securely access real-world data through oracle nodes like market prices, time of day, weather and GPS location,” for Defi’s recent growth.
The analysts also state that oracles “enable the next generation of blockchain use cases,” and could “disrupt major industries.”
Major companies including the Associated Press and AccuWeather are now using the Chainlink, monetizing their data by providing it to smart contract developers. Over 1100 projects are live on the network.
The blockchain’s native token LINK is now the 22nd most valuable cryptocurrency market cap, totaling over $7.5 billion. In September, the network partnered with Cardano to integrate oracle data into the latter’s smart contracts.
Bank Of America’s Bullishness On Crypto
Despite the conflict that banks and crypto are often presumed to have, Bank of America has been remarkably bullish on the space. In an October report, the institution noted that crypto was now “too large to ignore”. This was a sharp change of attitude from its previous stance in March 2021, where it deemed Bitcoin “too volatile” and impractical as a store of value.
However, the institution appears more interested in the broader crypto ecosystem, and blockchain technology as a whole. “Bitcoin is important, but the digital asset ecosystem is so much more,” reads its October statement.
PrimeXBT Special Offer: Use this link to register & enter CRYPTOPOTATO50 code to receive up to $7,000 on your deposits.