Thread by @ChainLinkGod

Connectivity 💾↔️⛓️
Privacy 🔒
Scalability 🌐

These are the three main roadblocks preventing #SmartContracts from reaching mass adoption today

#Chainlink $LINK will play a major role in bringing this space to the next level, making Web3.0 a reality

A thread ⏬

Connectivity is the main problem that Chainlink tackles

Smart Contracts cannot natively access data outside the blockchain, they need an off-chain Oracle to fetch the data and bring it back on-chain

More details about the connectivity problem below ⏬

https://twitter.com/ChainLinkGod/status/1198446995246964736

The next major roadblock is Privacy, it is a deal-breaker requirement for any level of enterprise adoption of Smart Contracts

Large institutions cannot leave public breadcrumbs about their sensitive financial dealings on a public immutable ledger that can be observed by anyone

This is the reason why most private permissioned blockchains exist

Hyperledger Fabric by @IBM
Hyperledger Sawtooth by @intel
Quorum by @JPMorgan
Corda by @inside_r3

If you have read about large institutions leveraging "the blockchain" it was probably one of these

These blockchains meet the on-paper requirements of enterprise, but still lack the security, composability, and network effects that a public permissionless blockchain like Ethereum can offer

So how can we square this circle and bring privacy to public blockchains?

>Chainlink

Many know Chainlink as just a data feed oracle

But it also can perform attested off-chain computation taking the heavy load off the blockchain, increasing efficiency, lowering gas costs, and enabling privacy

This requires a multipronged approach to implementation

The first prong is Trusted Execution Environments

Late last year, @Chainlink acquired @initc3org's Town Crier, a blockchain oracle that leveraged Intel SGX for confidentiality & integrity guarantees for data processed

This is live today
town-crier.org

Town Crier V2 is in the works which will extend Town Crier's capabilities over to #Chainlink

Having the oracle run inside of a TEE means that even the node operator won't know what data is being processed, this privacy extends to the cloud providers on which the nodes operate

This enables Oracles to now have the capability of holding user credentials, sensitive identifiable information, and even private keys for crypto on any blockchain

Simply put, Town Crier protects data in transit
blog.chain.link/town-crier-and…

But how do we know the data fetched is legitimate?

This is where deco.works, which was also built by @initc3org, comes into play

Deco is a privacy preserving oracle protocol that enables users to prove facts about their web data (TLS) sessions to Oracles

It is a three party handshake between the user, TLS web server, and Oracle

Users can't cheat the oracle
Oracle can't cheat the user

Deco is extremely flexible as it
• works with modern TLS versions
• requires no trusted hardware
• requires no server-side modifications

By using the above technologies, we have now privately secured data at it's origin point and when processed by the chainlink node

What about more computationally expensive operations? (machine learning, video/image rendering, batch transaction processing)

By the nature of being middleware Chainlink can connect to any execution environment and any second layer solution

This can include
@Hyperledger Avalon workers
@maticnetwork plasma chains
@CelerNetwork state channels
@GCPcloud functions
Any network, service, or cloud provider

This enables massive scalability as the entire contract can be executed off-chain!

This brings obvious privacy benefits, but it also enables scalability of Smart Contracts as they can execute and operate almost entirely off-chain, free of gas fees & high latency

I've talked a lot about how privacy is created by offloading work off-chain but what actually needs to be posted on-chain?

The bare minimum is the binding service agreement created and agreed to beforehand by all participanting Oracles

Reputation & collateral are important here

This doesn't leak any details of the contract being executed as the service agreement is just used to coordinate oracle actions, and afterwards act as immutable proof of performance (or lack thereof) by the Oracles

What about contract settlement privacy?

The answer is Mixicles (mixer + oracle)
Payment inputs are separated from outputs, keeping the result of the contract private

Oracles can add additional anonymity by sending dummy payments to the contract obscuring its true value

You can instead settle the contract on traditional payment rails (SWIFT, Visa, PayPal) sidestepping the issue almost entirely

Many institutions will only deal in fiat as that is another one of their requirements but Chainlink can support settlement on any system, on/off-chain

Recently the CL team has mentioned they are implementing Zero Knowledge Proofs

ZKPs allow you to prove something, without revealing what that something is, it's powerful groundbreaking tech

I'm interested in the result as ZKPs can be used both for privacy and scalability

Sergey also mentioned they were in the early stage of researching homomorphic encryption in application to Oracles 👀

It's important to note, Chainlink isn't bounded to any one privacy solution, it can connect any privacy solution, that exists now or in the future, to any DLT

#Chainlink has been in the works for a long time, things may seem slow to you or me, but their careful analytic approach is on purpose, the companies and projects that rely on Chainlink expect nothing less

The end result will be beautiful, all I can is, I'm very excited for 2020

Can't forget to mention Threshold Signatures! #Chainlink will be able to scale independently of #Ethereum throughput

Chainlink nodes aggregate their responses off-chain and make only a single transaction back on-chain, gas use will be extremely minimal

https://twitter.com/ChainLinkGod/status/1197255751397302272?s=20