Blockworks Year End Review (Chainlink)

[Anonymous No.57060565]

>Chainlink has maintained its monopolistic position within the vertical, introducing several new products in 2023. However, overall demand for these products has been lackluster, and Pyth has emerged as a notable competitor by creating a robust market position within low-latency oracles.

>Data Streams hasn’t yet seen a significant amount of usage. It should be mentioned that GMX was the first protocol to implement the product together with Chainlink’s Automation service. This was a major win for Chainlink since, in return for the tailor-made product set, GMX entered into a fee-sharing agreement to allocate 1.2% of its V2 and later protocol versions revenue to Chainlink. Such a revenue model should be significantly more beneficial for Chainlink than the per-data update payment method utilized for Data Feeds, as in the latter model, customers share the update fees between themselves. If Chainlink can push the fee-sharing model more aggressively in 2024, the project could significantly enhance its value capture.

>Problem within the oracle vertical: service providers are enabling a massive amount of high-value transactions for which they can’t charge adequately. In general, projects are operating with broken business models that can’t be maintained in perpetuity. For example, with the exception of Chainlink’s Price Feeds service, node operators were heavily subsidized by the project in 2023 such that operators could stay profitable, while Pyth’s operators were working practically for free. To be clear, this isn’t really a problem for major oracle protocols with highly valued tokens in the short to medium term since they can artificially increase node operator profitability by subsidizing them through native token inflation.

[Anonymous No.57060571]

>Chainlink is uniquely positioned due to the width of its product offering, but the demand simply isn’t there yet in markets adjacent to price data. Therefore, with the exception of Data Feeds and Data Streams, the rest of the project’s oracle and compute products will likely continue as unprofitable in 2024 until DeFi activity returns or new blockchain-based use cases are introduced.

>The Cross-Chain Interoperability Protocol (“CCIP”) was the most anticipated product launch by Chainlink this year. It entered a Mainnet Early Access phase on Avalanche, Ethereum, Optimism, and Polygon in the middle of July, with Arbitrum, BNB Chain, and Base Mainnets added since. Unlike traditional bridge protocols that target end users directly, the CCIP business model revolves around usage deriving from integrated protocols and, possibly, financial institutions. To transfer data across blockchains, Chainlink utilizes unidirectional and distinct pathways called Lanes, with each Lane consisting of three separate offchain node networks that must be in agreement for transfers to be finalized. This configuration is built to prioritize security over everything else, which is in contrast to most other projects within the vertical that generally optimize for speed and cost.

[Anonymous No.57060573]

>while Pyth’s operators were working practically for free
There's an industry term for this: Jannying.

[Anonymous No.57060576]

>>57060565
Garbage shill reviewer doesn't know what he's talking about.

[Anonymous No.57060589]

>>57060565
>>Data Streams hasn’t yet seen a significant amount of usage.
No shit because it's in early access and 99% of crypto is scammers dumping on fools.

[Anonymous No.57060598]

>Chainlink has strived to spin up a highly opportunistic narrative regarding the cross-chain messaging protocol being adopted by financial institutions and becoming the standardized solution for connecting TradFi entities’ legacy systems to the onchain ecosystem. CCIP has managed to set up impressive partnerships with some of the world’s largest financial institutions, the Depository Trust & Clearing Corporation, as well as SWIFT, engaging in test-phase collaborations where CCIP has been leveraged to move and settle tokenized assets between public and private blockchains. All of the aforementioned partnerships are in the early stages, and it’ll likely take several years before financial institutions begin actively incorporating onchain components into their operational models. In addition, there’s a notable risk that TradFi entities form an onchain-focused alliance similar to how SWIFT was originally created, or governments force their way into the vertical through regulation, creating proprietary solutions and pushing Chainlink out of its greatest potential target market.

>Despite CCIP having over 100 partnerships with financial institutions and crypto projects, usage was lackluster in 2023. It is still in a Mainnet Early Access phase, only two protocols, Aave and Synthetix, have leveraged CCIP in a somewhat meaningful manner. In the middle of 2023, Synthetix announced that it would be integrating CCIP into its V3 upgrade, but it seems that the project has decided to utilize Wormhole’s solution instead, at least for some of the use cases originally planned for CCIP. Despite headwinds, it’s worth monitoring CCIP activity in 2024. Mainnet General Availability is poised to launch at the beginning of the year, and partner protocols will likely begin leveraging the solution more actively. The market has been underwhelmed with CCIP usage, with many writing off any short-term potential, which could warrant a new LINK narrative if activity suddenly picks up.

[Anonymous No.57060613]

>>57060573
Kek

>>57060576
>>57060589
Yup, but it's still fun to read. See shadow fork mentioned here >>57060598

Source btw:
https://app.blockworksresearch.com/research/2023-year-end-review-network-coverage

[Anonymous No.57060627]

>>57060598
>Despite CCIP having over 100 partnerships with financial institutions and crypto projects, usage was lackluster in 2023
lmao imagine saying
>despite having over 1000 people on the guestlist, usage of the nightclub was lacklustre
when it hadn't even opened its doors yet

>there’s a notable risk... governments force their way into the vertical through regulation, creating proprietary solutions and pushing Chainlink out of its greatest potential target market.
fucking kek the absolute state of grasping at straws fud, this shit cracks me up.

[Anonymous No.57060686]

>dtcc and swift working with ccip
>"akshually its bearish cuz they will fork it"
fuddies are mentally ill or paid off by jump

[Anonymous No.57060714]

>>57060627
pyth / jump trading mouthbreathers have always been pretty fucking retarded and obvious desu

[Anonymous No.57060737]

>>57060598
>In addition, there’s a notable risk that TradFi entities form an onchain-focused alliance
friendly reminder that this already happened and the result was Chainlink

[Anonymous No.57060752]

>no mention of LPL
based LPL chuddie kiddos we are early

[Anonymous No.57060919]

>>57060752
Unironically a hidden gem with sub 5 mil mc and good Tokenomics considering the potential growth for liquid staking.

[Anonymous No.57061458]

>stinkies see a non biased write up
>fuddiessssss
>jumppppp

Mind broken cult members, they’re right. There’s zero demand for chainlink

[Anonymous No.57061496]

>57061458
>a non-biased write up

[Garibaldi No.57061527]

>>57060737
kek so true

[Anonymous No.57061649]

>>57061458
>look, all I’m saying is that chainlink had a bad year despite having 1000s of partners and users, still dominating the industry, having institutional interests, releasing major product milestones and updates, gaining price momentum, and overall positive growth trajectory.
>bro Pyth is better because… look it just is ok?
I wonder who paid this retard to write this article /s

[Anonymous No.57061656]

>>57061649
nigger chainlink makes no money

[Anonymous No.57061704]

>>57061649
Can you read? They're saying being dominant in a space where you don't make money is retarded. Who cares if they are "the dominant provider" of services no one pays for, holding the token is fucking stupid. Holding pyth is stupid too, fwiw

[Anonymous No.57061768]

>>57061704
>>57061656
Then get out of crypto

[Anonymous No.57061782]

>>57061768
Nope, all in L1's, have fun with your company donation token

[Anonymous No.57061816]

>>57061768
its not wrong to want a project that you have beg held for seven years to be profitable you twat

[Anonymous No.57061828]

>>57061458
this. i hold 15k chainshit and the level of cope in this thread is astronomical. LOOK AT THE PRICE ACTION, THATS ALL THAT MATTERS.

[Anonymous No.57061864]

>>57060565
all of these things are paid by pyth, solana scammers are mad that chainlink isnt supporting them. That being said, pyth has a good chance of outperforming link

[Anonymous No.57061910]

>>57061816
if chainlink isnt "profitable" how does anyone expect these C- tier oracles like pyth or band, going to make money?

[Anonymous No.57061917]

>>57061816
If you have held for seven years you are in profit

[Anonymous No.57061928]

>>57061917
no, im being diluted currently

[Anonymous No.57061952]

>>57061928
You are not a shareholder. You bought internet funny money.

[Anonymous No.57062001]

>>57060627
>>there’s a notable risk... governments force their way into the vertical through regulation, creating proprietary solutions and pushing Chainlink out of its greatest potential target market.
>fucking kek the absolute state of grasping at straws fud, this shit cracks me up.

how is this fud?
it is already happening, see jpm's "liink"
everyone was convinced it would be a chainlink service a few years ago due to its functionality being identical to it, only for us to recently discover that it was a completely original solution with no connection to sergey

[Anonymous No.57062068]

>>57061952
nope. just sergeys exit liquidity

[Anonymous No.57062135]

>>57062068
We already know youre a complete retard. No need to go further. We know its "fun" to fud link

[Anonymous No.57062145]

>>57061782
You sure showed me faggot

[Anonymous No.57062162]

>>57062068
Not our fault you bought at $50 you dumb motherfucker

[Anonymous No.57062192]

>>57062001
Remember the Christine Moy bullshit too? Good ol' /biz/

[Anonymous No.57062198]

>>57062068
You all sound like broken records
>muh elaborate scam
>muh exit liquidity
We’ve known about the token dumps since the very beginning

[Anonymous No.57062266]

>>57060565
Like I've posted a few times on /biz/, we're still pretty far from any real profitable use cases for LINK. Crypto is still just gambling.

[Anonymous No.57062280]

>>57061910
None of them are going to make money...

[Anonymous No.57062559]

>>57062280
Are you retarded?

[Anonymous No.57062560]

Chainlink “dominating” a space with no demand is akin to winning the special olympics, financially speaking

[Anonymous No.57062582]

>>57062559
Oracles aren't a very profitable space. This is literally what this article is explaining.

[Anonymous No.57062601]

>>57062582
Then why is Oracle one of the most, if not most, profitable companies in the world?