Chainlink, the network that operates a decentralized oracle powered by its insanely popular, eponymous coin, today announced the acquisition of DECO, an oracle security protocol created by Cornell University faculty and students.
Chainlink also hired Cornell professor Dr. Ari Juels as Chainlink Labs’ Chief Scientist to oversee DECO’s integration. Chainlink has not disclosed how much it paid for the protocol, nor Juels’s salary.
DECO, short for decentralized oracle, was created by Cornell’s Initiative for Cryptocurrencies and Contracts. DECO essentially makes Chainlink, a decentralized oracle network that lets smart contracts use data from external sources, more private. With DECO smart contracts can prove the origin and state of confidential information transmitted through an oracle, without forcing a user to give up their personal data.
You could use DECO to prove to a smart contract run by, say, a fan club for Chainlink co-founder Sergey Nazarov, that you have a certain amount of $LINK in your Coinbase account or that you’ve posted a certain amount of $LINK memes on Reddit, without having to give up your wallet information or Reddit username.
There’s broader implications for DECO, too: DECO could be used by financial institutions to prove the balance of an account without actually making the contents of the account public. A border agent could prove that you’re a US citizen without having to have access to your passport.
“DECO enables a large expansion in the quality and breadth of data that can now be made available to public blockchain systems,” Chainlink co-founder Sergey Nazarov told Decrypt.
Nazarov also said that DECO will help new types of collateral reach DeFi, or decentralized finance. “There’s lots of private data associated with real-world collateral, like the state of an invoice, or ownership of real estate, or some other insured asset. DECO-enabled Chainlink oracles will be able to prove to a smart contract that the state of the asset is solvent, without disclosing private or personal ownership information onto a public blockchain,” he said.
“This expansion of data availability will continue to drive the creation of new universally connected smart contracts, such as DeFi, decentralized insurance, global trade and various enterprise use cases that are now compatible with public blockchains and semi-private consortium chains,” he said. “Essentially, DECO-enabled Chainlink oracles will enable DeFi to mature and reach its next growth stage.”
Dr. Ari Jules is currently a professor of Computer Science at Cornell University and was formerly the Chief Scientist of RSA security, a Massachusetts-based cybersecurity and digital risk management firm. Dr. Jules contributed to a 1999 abstract formalizing Proof of Work computation and was a contributing author of the Chainlink whitepaper alongside Sergey and Chainlink co-founder Steve Ellis. “With its strong focus on cutting-edge research for high-trust systems such as blockchains and prominence as a provider of oracle technologies, I think Chainlink is ideally positioned to bring DECO to production,” he said in a statement.