Binance Smart Chain will integrate Chainlink data oracles to add usability to its blockchain, in particular, in the burgeoning DeFi space.
Binance Smart Chain — a dual-chain architecture from major crypto exchange Binance — is now integrating Chainlink (LINK) data oracles.
Binance Smart Chain adds smart contracts to the exchange’s original chain, Binance Chain, and is currently in testnet.
Chainlink co-founder Sergey Nazarov told Cointelegraph that in his opinion, this integration will save time and effort for developers who are building decentralized apps on the blockchain:
“With the Chainlink integration, Binance Smart Chain developers no longer need to dedicate months of engineering time to set up their own oracle infrastructure. Now, they can simply use Chainlink as an abstraction layer to build secure and reliable universally connected smart contracts.”
According to Binance, this integration will allow it to expand the usability of its smart contract enabled blockchain; in particular, in such areas as decentralized finance, payments and asset management.
Most blockchains, and Binance Smart Chain is no exception, cannot directly interact with outside data sources. This is meant to make its environment more secure, but nonetheless, narrows down its usability. The importance of robust oracalized data for the DeFi space has come to the forefront with recent exploits.
Oracles are essential for DeFi growth
Nazarov believes that the availability of secure oracles is essential for the growth of DeFi space as a whole, pointing to the recent success of Aave.
He said, “What has been slowing down DeFi is the need for teams to build infrastructure while also building their financial products. It’s not a coincidence that the growth of Defi coincides with a growing abundance of high quality oracle data.
“DeFi projects can be launched and built in a matter of weeks rather than months. We’ve already seen huge success stories like Aave, who launched using Chainlink earlier this year and have rapidly grown to over $500MM in value secured,” he added.
LINK 30-day exchange volume. Source: Nomics.
Binance is the dominant exchange for the LINK token as over the past 30 days it processed almost one-third of the total trading volume. The further integration between the two companies adds up on several levels.