\u201cChainlink is the largest decentralized oracle network, offering solutions to a variety of industries including: \u2022 DeFi \u2022 Enterprise \u2022 NFTs and Gaming \u2022 Social Impact \u2022 Climate Markets\u2026<\/em><\/p>\n \u201cThe ecosystem is powered by the $LINK token, which has three purposes. It\u2019s: \u2022 Used by clients to pay for services \u2022 Received by oracles as compensation for work performed \u2022 Serves as collateral to ensure that oracles behave properly\u2026<\/em><\/p>\n \u201cChainlink occupies a unique position as the dominant \u201cmiddleware\u201d layer transferring data between blockchains and the real world\u2026 Since it\u2019s already transferring data, it\u2019s not a huge leap to perform computations on that data, store or even transmit it\u2026 This is exactly what the protocol plans to do with the release of Chainlink 2.0\u2026 <\/em><\/p>\n \u201cIt\u2019s utilizing \u2018hybrid smart contracts\u2019 \u2013 computer programs that that combine ON-chain data with OFF-chain data \u2013 to create a new layer that can perform computations off-chain\u2026 If executed correctly, this hybrid smart contract layer could create a lot of benefits, such as: 1. Scalability 2. Privacy 3. Interoperability\u2026<\/em><\/p>\n \u201cIn a way, Chainlink could function as an \u2018upside down\u2019 Cosmos or Polkadot Instead of connecting multiple L1s at a base, or \u201cL0\u201d layer, it could connect them at the L2 layer If successful, this could be huge, as it could replace traditional interoperability solutions\u2026 While it\u2019s too early to tell whether Chainlink 2.0 will succeed, if it does it could represent a major paradigm shift in Web3 \u2013 a unified \u201cmiddleware\u201d layer that provides the functionality of a: \u2022 Privacy tool \u2022 Layer 2 \u2022 Bridge\u2026<\/em><\/p>\n \u201cChainlink has achieved significant traction to date, it: \u2022 Has enabled over $6 trillion in transaction volume \u2022 Delivered 5 billion data points on-chain \u2022 Supports 14+ blockchains and L2s\u2026 The protocol has also partnered with a variety of players in Web 2.0, such as Google Cloud and Oracle and dozens of projects across the Web3 ecosystem\u2026<\/em><\/p>\n \u201cIt\u2019s difficult to value Chainlink because there is no real-world analog to an oracle network While oracles are important, they are a unique phenomenon to Web3 But that\u2019s not too concerning, as I\u2019m not sure that $LINK should be valued as an oracle anyway\u2026 Given the plans for Chainlink 2.0, I don\u2019t think it\u2019s unrealistic to value Chainlink as a Layer 1 In a sense, it could achieve what Cosmos and Polkadot are hoping to do and provide a unified layer for: \u2022 Privacy \u2022 Scalability \u2022 Interoperability<\/em>\u2026<\/p>\n
![](\"https:\/\/cryptoglobe.s3.eu-west-2.amazonaws.com\/2022\/11\/LINKUSD_2022-11-29_13-56-21-1-1280x415.png\")
<\/p>\n