Chainlink staking overview
Published · Updated
Staking will be a major breakthrough for Chainlink and the community from a number of different perspectives. Let us uncover how you put your LINK tokens to use and get rewards for helping Chainlink secure DeFi and the larger Web3 ecosystem.
Chainlink recap
As you know, Chainlink is the industry standard oracle network that has enabled over $6.4 trillion in transaction value across Ethereum, Polygon, Solana, and 12 other blockchain networks, at the time of writing. They do so by providing highly available and accurate on-chain market data, for hundreds of data feeds. When you use a DeFi application on Ethereum, it is highly likely that it leverages Chainlink Data Feeds to get the latest token prices in order to execute a lending, swap, or any other smart contract.
The Chainlink Network achieves decentralization and security in two ways:
- A node operator uses multiple data APIs to get price updates, so that if one of them fails, the others still can provide accurate information;
- Multiple node operators handle the same price feed, so that if a few of them fail to provide an accurate data update, the reported price can still be relied upon.
The value in this approach to decentralization has been shown time and again during periods of extreme market volatility, when Chainlink’s multiple layers of decentralization and defence-in-depth design help mitigate the risk of market manipulation, oracle attacks, and other exploits.
P2P has been operating on Chainlink for the last two years and supports price feeds and automation for Ethereum, Solana, Moonriver, Fantom, Harmony, and Avalanche.
Why implement staking now?
As the total value secured by Chainlink oracle networks grows, the reward for a hypothetical attack increases, hence a need for increased cryptoeconomic security that maximizes the cost of attack for malicious actors. As of now, the node operators are sufficiently decentralized and perform well enough so that further improvements in this area only provide marginal gains. Staking however, can drive way more significant security improvements via new incentives for the node operators and token holders.
How staking is going to work
Node operators and the broader Chainlink community will be able to stake their LINK via node operators and get rewards for helping enhance the cryptoeconomic security of the network. Providing accurate and timely feed updates is necessary for the node operators to actually receive those rewards and in order to enforce the best data quality.
In the early-stage beta implementation of Chainlink Staking, v0.1, stakers will have the opportunity to monitor the feed, raise an alert, and get rewarded if they successfully detect in a timely manner that the ETH/USD feed has not met certain performance requirements. In v0.1, alerting conditions will be focused on feed uptime but will expand in scope in later versions.
The Chainlink Staking design is quite complex, so its elements are going to be brought forward step by step.
Who can stake during Early Access
According to a Chainlink blog post, there are 3 criteria for participating in the Chainlink Staking v0.1 Early Access which will launch on mainnet in December 2022:
Criteria | Details |
Hodler | Token holders who fall into either category:
|
Builder | Participating teams in any Chainlink-hosted hackathon from Fall 2020 to Spring 2022. |
Educator | Chainlink Advocates, Developer Experts, and others who have demonstrably hosted or spoken at Chainlink meetups about the Chainlink Network or Chainlink Ecosystem. |
You can use the Early Access Eligibility App to check their eligibility for potential priority access staking in Staking v0.1.
Roadmap
As we discussed previously. The primary goal of Chainlink is to increase the security behind the infrastructure that supports DeFi. As outlined in a blog post, Chainlink Staking is being designed with four long-term goals in mind:
- Increase the security and user assurances of Chainlink oracle services;
- Enable a more direct community participation in the Chainlink Network and its security;
- Generate sustainable rewards from real use cases;
- Empower node operators to access higher-value jobs by staking.
Like previous Chainlink updates the implementation of LINK staking is being done gradually. While the initial focus will be on building a reputation framework and staker alerting system, the second stage will look to implement slashing to further boost security and user fees as rewards. Last but not least, loss protection is being studied to help protect participants when an oracle network deviates from its service-level agreement.
The first version of staking is expected to go live by the end of 2022. Stay tuned!
What's next
At P2P, we are watching closely as LINK staking gets close to launch, and will post updates on this topic here in the blog as soon as more details are found. We are also exploring what kind of tools we can bring forward to help the community. So watch this space, much more to come in the near future!
Check your eligibility for Early Access to Chainlink Staking v0.1.
Contacts us if you are interested in staking LINK:
Email : [email protected]
Telegram: P2Pstaking
Twitter: @P2Pvalidator
About P2P
P2P Validator is a world-leading staking provider with the best industry security practices and proven expertise. We provide comprehensive due diligence on digital assets and offer only top-notch staking opportunities. At the time of the latest update, more than 1,5 billion USD is staked with P2P Validator by over 25,000 delegators across 25+ networks.
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