Partnerships
Because it provides such a valuable and essential service, Chainlink has built up a massive list of partners, including many of the biggest blockchain networks, decentralized finance (DeFi) platforms, and crypto games. Here are some of the major blockchain networks that are using Chainlink:
One of the most notable companies working with Chainlink is Alphabet (GOOGL +1.50%) (GOOG +1.39%), which decided to use Chainlink for its Google Cloud service. The partnership involves Google putting its BigQuery data on the blockchain through Chainlink.
A major Chainlink partner in the crypto industry is the Binance crypto exchange. It uses Chainlink to connect its data to blockchain platforms.
Keep in mind that those are just a small selection of some important connections made by Chainlink. The Chainlink ecosystem contains more than 1,000 partnerships and collaborations.
Can I make passive income with Chainlink?
You can make passive income with Chainlink by lending your LINK tokens to a crypto lending program. If you're a U.S. resident, CoinLoan and Gemini are two platforms that support Chainlink lending. While Gemini is considered one of the top crypto exchanges, CoinLoan offers much higher interest rates on LINK.
Lending crypto has its risks. Like any other type of lending, you can lose your funds if a borrower defaults.
Unique risks
To Chainlink's credit, it doesn't have any glaring weaknesses or flaws. The price is volatile and it's part of a very new, unproven industry, but that's the case for all cryptocurrencies. If you're going to invest in any types of cryptocurrency, volatility and risk come with the territory.
Chainlink has gotten attention for its token distribution. A 2021 report found that 125 wallets held 81% of the total LINK supply, with Chainlink node operators holding 35% and the Chainlink team almost 25%.
Although this can lead to worries that a small group of whales (investors who own large amounts of crypto) have too much control, that doesn't seem like the case here. The Chainlink team was open about token distribution from the beginning and how it would use its supply to fund development. A large part of the reason Chainlink has been so successful is because the team has had the funds necessary to expand.
Is Chainlink a good investment?
Chainlink is a quality investment that's worth considering if you're building a cryptocurrency portfolio. It offers excellent utility, widespread adoption, and has a significant first-mover advantage compared to other decentralized oracle networks.
Smart contracts on every blockchain network need (and will continue to need) real-world data. Chainlink provides an efficient and accurate oracle solution. The fact that there are already so many projects using the Chainlink network is a testament to its utility.
Also boding well for Chainlink's growing adoption is the fact that it’s blockchain-agnostic and not tied to any single network. Chainlink also has shown initiative in proposing a global, open-source standard for cross-blockchain messaging, the Cross-Chain Interoperability Protocol (CCIP). Whether or not CCIP becomes a popular global standard, its proposal is significant, and it puts Chainlink in a high-profile position as the blockchain industry continues to evolve.
When you look at the oracle token market, it's apparent that Chainlink is in a very strong position. None of its competitors even come close in terms of size. As of May 2022, no other oracle token had even one-tenth of Chainlink's market cap or had broken into the top 100 cryptocurrencies.
That being said, it's also important to be cautious about any cryptocurrency investment. As mentioned earlier, prices are volatile, and they can rise or fall quickly. If you decide to invest in Chainlink, other projects, or cryptocurrency stocks, be cautious about how much you spend.
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