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What does the Chainlink 2.0 white paper say?

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Chainlink 2.0 whitepaper uses DON as the foundation and hybrid smart contract as the carrier to give us a blueprint for the future prophet

A Quick overview of Chainlink 2.0 White Paper

Chainlink

Chainlink2.0 is a further expansion of the original white paper, and its vision is forIntelligent contractFast and reliable access to any off-chain data source and off-chain computing resources while protecting privacy, complementing and enhancing the performance of existing and new blockchains. From the vision, Chainlink serves all existing and potential blockchain smart contracts, providing them with not only off-chain data, but also off-chain computing, fully meeting any off-chain requirements of smart contracts.

To achieve this vision, Chainlink 2.0 proposes the concept of a decentralized Network of Prophets (DON), a network maintained by a set of Chainlink nodes that have the flexibility to choose and deploy any of the prophets' capabilities based on a board consensus agreement. DON's proposal expands the original functional predictor into a cluster of predictor, realizing the evolution of the topology of predictor from point to network. The biggest advantage of DON is the ability to quickly launch new blockchain services without the need to develop a new private network for each blockchain or service. That way, DON can respond quickly and plug in whenever new application scenarios change.

DON consists of an executable, which is a deterministic program, and an adapter, which is the interface that DON interacts with the outside world. Executable programs are similar to smart contracts, which can perform specific calculations, such as generating random numbers and triggering the automatic execution of on-chain contracts. Adapters are like interface converters that allow DON to connect to blockchains, Web servers, storage servers, and other DOns.

The Chainlink 2.0 whitepaper also lists five practical use cases for DON: Proof of reserves, access to enterprise/legacy systems, decentralized identity, priority access, and securityDeFiMixicles for privacy.

Proof of reserves is often used to verify messages between different blockchains, such as when a user locks up a position in a Bitcoin chainBTCAfter issuing WBTC on Ethereum, the Ethereum application needs to verify that the full amount of BTC is locked up on the Bitcoin chain. Using the reserve certificate, DON can access the reserve information on the Bitcoin chain and feed it back to the Ethereum app to secure the WBTC's issuance endorsement. Because of DON's connectivity, companies can send legacy system data to the blockchain without additional development, making it much easier to access their legacy systems. Decentralized identity refers to the establishment of user identity information through blockchain. The information can come from the credit data of traditional systems, such as the banking system, etc. Through DON, such private data can be provided to smart contracts for the use of low mortgage lending, KYC and other blockchain applications. Priority channel is a guarantee that miners give users that their transactions will be stored in a block on the chain and can be easily implemented with DON. Mixicles is a privacy DeFi tool developed by Chainlink Labs to ensure duality without disclosing the underlying asset informationoptionsDeal.

Chainlink 2.0 whitepaper separately introduces DON's Fair Sorting Service (FSS). Fair sorting includes two aspects: one is sorting according to the time sequence of node receiving transaction; The second is to preserve the causal relationship between transactions. The so-called causal relationship refers to hiding the transaction data and disclosing the transaction order after the consensus layer completes the ranking, so as to prevent the change of the causal relationship between the transactions. Therefore, fair ranking service can effectively eliminate the false start transaction.

The Chainlink 2.0 whitepaper mentions the Transaction Execution Framework (TEF) adopted by DON. TEF has the advantages of high performance, low cost, privacy protection, support for any L2 execution technology and paradigm, can quickly update the main network smart contract, while preserving the key credibility of the main network.

Decentralization is also a focus of the Chainlink 2.0 whitepaper, which discusses decentralization options in terms of the flow of data from the data source to the DON to the main network smart contract. For data sources, data source authentication mechanism is designed to ensure that data is provided by trusted data sources without tampering. For DON, design mature client to prevent client failure and support minority report; Establish monitoring and invalidation for smart contracts on the main networksecurityMechanism, implement trust minimization governance, establish on-chain identity for DON nodes, etc.

One of the key measures to build a decentralized trust model is to design appropriate economic incentives. The Chainlink 2.0 white paper uses explicit and implicit economic incentives. Explicit economic incentives are pledged for equity, and Chainlink nodes pledge a certain number of LINK tokens to participate in DON. Chainlink's pledge is very different from the pledge on blockchain. On the one hand, the pledge is mainly used to verify the validity of the data in the chain, rather than to reach consensus at the bottom of the blockchain. On the other hand, Chainlink's pledge of interest is mainly used to prevent nodes from accepting bribes and sending fraudulent data. For this purpose, Chainlink proposes super-linear pledge of interest, which means that attackers need to provide a margin much higher than the pledge of nodes to effectively attack. Implicit incentive refers to future revenue opportunities, that is, only nodes with high service quality and good reputation can attract potential users and obtain future revenue opportunities.

Chainlink 2.0 white paper describes smart contracts that use off-chain resources as hybrid smart contracts. A smart contract that runs only on the chain can only provide partial functions due to limited, expensive and slow on-chain resources, while a hybrid smart contract combined with DON can theoretically obtain unlimited off-chain resources. It also transfers the high cost of on-chain computing to the low cost of off-chain computing, thus providing complete functionality while inheriting the advantages of smart contract decentralization and no licensing. One of the advantages of hybrid smart contracts is that it is clear that the smart contract contains off-chain components, and that the off-chain components are part of the smart contract rather than separate areas.

Chainlink 2.0 whitepaper uses DON as the foundation and hybrid smart contract as the carrier to give us a blueprint for the future prophet.