Thread by @ChainLinkGod

1/ A comparison of DevOps versus Data Provider operated oracle nodes

Both have their advantages, but the nuances are often lost to the noise

#Chainlink is a framework for building oracle networks and supports both simultaneously

Let's explore 👇

2/ DevOps operated oracle nodes:

These are professional infrastructure providers who connect smart contracts to real-world data

For Chainlink, this includes telecommunication enterprises, PoS staking pools, PoW mining pools, DeFi projects, Chainlink ecosystem firms, and more

3/ To power on-chain data feeds, each oracle node fetches data from multiple external APIs, aggregates the results into a single value, then aggregates that result with other nodes off-chain to generate a final medianized value that is then delivered onto any blockchain network

4/ Exisiting Chainlink nodes run by DevOps teams includes @deutschetelekom, @Swisscom, @staked_us, @linkpoolio, @Fiewsio, @snzholding, @Wetez_wallet, @Simply_VC, @stakefish, @chainlayerio, @AnyblockTools, @everstake_pool, @Figment_io, @KyberNetwork, @linkriver_io, and many more

5/ The advantage of DevOps operated oracle nodes is that they are backwards compatible with all exisiting APIs

Data providers can sell their APIs to existing oracle nodes without changing anything about their backend infrastructure or need to deal with crypto custody

6/ Additionally, DevOps oracle nodes don't just relay data on-chain, but also perform off-chain computation

This includes generating verifiable randomness and processing Keeper functions, cross-chain messaging, fair transaction ordering, zero knowledge proofs, and more

7/ This benefits everyone as smart contract developers get access to the data they require, data providers are able to increase their revenue without modifying their backend system or business model, and oracle nodes generate revenue to provide a wide array of oracle services

8/ Data Provider operated oracle nodes:

These are traditional data providers who launch a node to offer smart contracts access their APIs

For Chainlink this includes data provider nodes for financial prices, weather, sports, identity, location, real estate, news, and more

9/ Data providers who launch their own oracle node can

1) Cryptographically sign data from their APIs for increased tamper-resistance

2) Sell their data directly to any blockchain network

3) Leverage Chainlink's exisiting network effects with its hundreds of users

10/ Data Providers that have or plan to launch a node include @accuweather, @krakenfx, @dxFeedSolutions, @TiingoFinance, @finageltd, @GenesisVol, @tradermade, @ciphertrace, @GeoDataBlock, @ProspectNow, @smartzip, @LigaTV, @SportMonks_com, @sportsdataio, @therundownio, and more

11/ Data Providers can choose to either launch their own oracle node and/or sell their APIs to existing DevOps oracle nodes in a backwards compatible manner

This high degree of flexibility allows for all the world's data to be brought on-chain
blog.chain.link/how-chainlink-…

12/ While some oracle solutions only focus on providing one or the other, #Chainlink's ability to support both allows both data providers and users to choose the approach that matches their exact needs

13/ Additionally, with Chainlink's DECO (zero knowledge proofs), users will be able to cryptographically prove to an DevOps Chainlink node that a piece of data came from a specific TLS web session with a data provider in a privacy preserving manner

This is a hybridization

14/ Furthermore, through Chainlink's Town Crier (Trusted Execution Environments), DevOps nodes can be further trust-minimized by running the node in a hardware-based black box, preventing tampering and providing additional proof that data came from a specific data provider

15/ A reality that should be acknowledged is that the vast majority of the world's data from APIs cannot be brought onto a public immutable ledger, either due to business or legal reasons

This requires a privacy preserving solution like DECO where only a proof is put on-chain

16/ Ultimately this approach follows the standard API model of today where data providers specialize in data production and providing APIs, distributors specialize in aggregatation, computation, and delivery to blockchains, while the data is kept private with full integrity

17/ I hope this thread provides some context to the advantages of each type of oracle node, and why #Chainlink is optimized to support both

The API economy is massive and will only continue to grow with the increasing adoption of hybrid smart contracts across blockchains