Chainlink in danger? The giant Binance launches its Oracle service on the BNB Chain
Binance plays its Nostradamus – Binance is the largest cryptocurrency exchange. Alongside its centralized service, the company launched its blockchain, the BNB Smart Chain in September 2020. From now on, the company wishes to tackle a new sector: that of DeFi oracles.
Oracles in DeFi: what is it?
Since its emergence, decentralized finance has never stopped innovating and attracting more and more users. However, this cannot exist without certain tools such as oracles.
Indeed, decentralized finance is based on a series of smart contracts. However, these contracts are only able to retrieve and process information available on the blockchain. However, in many applications, smart contracts require data external to the blockchain, such as the price of cryptocurrencies.
This is where oracles come in. Thereby, oracles are computer programs whose mission is to make certain data compiled off-chain accessible on-chain.
So far the project chain link reigned supreme in this area. Indeed, smart contracts can interact with the protocol to obtain various services:
- Obtain the price of cryptocurrencies thanks to price feeds;
- Generate random numbers through the VRF service;
- Automate actions;
- Allow communications between blockchains.
For its price feed service, Chainlink will aggregate and verify data from several centralized and decentralized trading platforms to communicate the fairest price.
Binance unveils its oracle service
On October 26, the giant Binance unveiled the launch of a new service. In effect, the platform unveiled its Binance Oracle service.
“As oracles – data bridges between blockchains and the outside world – become increasingly central to the blockchain ecosystem, there couldn’t be a better time for Binance to unveil its reliable and secure blockchain data service.
Initially, Binance’s oracle service will be deployed on the BNB Smart Chain. We should see it migrate to several more blockchains in the coming months.
In practice, Binance Oracle is made up of two modules. On the one hand, we find the off-chain part. This will retrieve data from verified suppliers, validate them and make them available to users.
“One of the strengths of Binance Oracle is its threshold signature scheme, which is applied to every data stream in a distributed signing process, ensuring there is no single point of failure in security. system data. The authenticity of the data is also continuously verified using Binance’s public key, which ensures that the data is not tampered with during the powering process. »
On the other side, we have the on-chain part. This is made up of an API and smart contracts, acting as an interface allowing apps to interact with the service.
In parallel, the direct competitor of Binance Oracle, Chainlink continues its expansion. Thereby, the teams announced a joint project with Swift, one of the cornerstones of global financial services.