Hello steemians , I hope you all are doing very well. In this post , I am here to submit my homework task 3 which I have carried out as required by @gbenga, crypto professor.
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The homework task is to discuss a full project built on the Ethereum blockchain, I will be discussing the ChainLink project built on the Ethereum platform.
A brief introduction to Ethereum
Ethereum was developed in 2015 by Vitalik Buterin 2015 to fix the setbacks on the Bitcoin blockchain. The idea behind Ethereum is that the Bitcoin blockchain has more to offer to developers than just money for payments. Ethereum is an open-source blockchain-based decentralized framework that allows users to create and run a permissionless application without the intervention of a third party 1. Just like Bitcoin, Ethereum has its own coin known as Ether which can be used for payment purposes and transaction fees (Gas fees). Similarly, Ethereum allows users to build their tokens to fund their projects through Initial coin offering (ICO) and presale.
ChainLink
chainLink is a digital ecosystem built on Ethereum blockchain. Ethereum blockchain makes use of data on its blockchain to create smart contracts, Chainlink saw this as a gap in the Etheruem blockchain and developed an ecosystem that will accommodate data from an outside source to the Ethereum blockchain to maximizes the potential usability of the smart contracts 2. Chainlink aim at optimizing smart contracts by facilitating secure and precise data transfer between the blockchain and the real world.
Data from an external source like Paypal can be connected to the Ethereum blockchain through oracle nodes of the off-chain blockchain. This node will provide real-time data about the user experience and retail payments of Paypal 3
How ChainLink works
We have discussed the main purpose of Chainlink which is to allow interaction between the external source and the blockchain. Chainlink is made up of two primary components which must interact together to deliver its intended function. The on-chain and the off-chain blockchain.
Chainlink on-chain:This is the first part of the Chainlink network which includes the smart contracts created by oracles to process data requests from the off-chain blockchain.
Chainlink off-chain: This component contains oracle nodes connected to the Ethereum network. Data from external sources like Amazon are connected through these oracle nodes for processing. The data from external sources are processed through Chainlink core which is a software that connects the off-chain data sources to the ChainLink blockchain 4
Conclusion
Chainlink is a decentralized digital ecosystem built on an Ethereum network that provides data and information from off-chain sources (external data) to the on-chain blockchain (smart contracts) through an oracle network. The Link token is the digital currency used for payment on the Chainlink network.
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