I was a little down about the blog post and drank too much last night. A lot of you are looking to the threshold signatures post as something bullish. There are a lot of you who are viewing this as a full scaling solution for ETH. Here's what it actually is:
>It allows aggregation to be done with essentially the same level of security as on-chain aggregation for a markedly reduced gas cost >This was a major concern for the network in that link is tied to ETH as the layer on which link is transferred and held >The scaling issues ETH has with respect to token transfers, executions of smart contracts etc. won't be directly affected, however >The overall picture of how Chainlink based (not Ethereum, hyperledger etc.) smart contracts can now be somewhat effectively seen ....
So from top to bottom, how does a smart contract work? And more importantly, what networks can be duplicated and what portions of the networks can effectively capture the most value?
First, there must be a network for the posting and execution of the smart contract code. There are discussions about how much advantage is gained by having this network be public and permissionless, but the key point about this network (ETH, Hyperledger, Dfinity, or [most likely in my opinion] a layer two scaling solution built on top of a gen 1 robust public distributed network that only writes to the public chain under certain circumstances [usually only to verify successful completion or to document dispute triggering])
Next there must be a network asset or mechanism which captures value for the posting and execution layer. In ETH this is ETH; in hyperledger this is the cost of permissioned use
Next there must be an input/output layer that makes the contract do stuff related to real life in real life. Our little hexagon is making a great case to be this layer for all of the execution layers. There also must be a way to transfer value within this layer and for now this is link on ETH- one of the early concerns was the thought of transferring 2 dollars of link for every smart contract, but it appears these transfers really only need to be finalized or posted to chain when a node wants to deposit or withdraw (and not for each individual incidence of contract execution) if we are to trust Thomas who discussed this early.
Then there is the computation portion, which can be done on the execution layer or the oracle layer. Chainlink is making a strong case to take this portion over with work like this threshold signatures post and their pull request on git. ....
Camden Cox
The sum total for all of this is a setup with the potential to cross the cost efficacy threshold for use of smart contracts in high and medium value situations. IOT and micropayments are definitely still not cost effective even using all of the above, but a 5c-$1 total cost depending on the data and computation required opens up far more use cases than a 50 dollar all on chain smart contract.
This also brings up one more point: just like how Vitalik doesn't like that Chainlink has taken the timeline out of his hands for ETH, Chainlink is (ironically) now a slave to the layer two scaling solutions for the use of smart contracts in medium value applications. I would guess that's why they chose to back celer at this stage. I think this also makes Chainlink a less fun hold from here on out as the things that determine the assets value are basically going to boil down to these two:
>How fast can they get those high value inputs and outputs up, running and available on their network (they definitely control this one) >How fast does layer two become available for those high frequency, medium value smart contracts that will account for the majority of the value add long term
To be clear I'm not selling and will probably never sell. What I'm saying is that the price action is going to become less predictable going forward. The advice to put your linkies on cold storage and come back in a year has never been better.
Nicholas Peterson
Great stuff, user. Thanks for bringing more clarity to this. I've screencapped it for later use.
Would anyone suggest buying at these prices or wait until a sub 80c range or something?
Jaxon Hernandez
thanks bro
Kayden Gomez
The data optimal answer is to buy now if you believe in the project The risk adverse answer is to dollar cost average over a set period of time knowing that over infinite samples this will cost you money but limit variance
Hunter Phillips
As far as the next steps for Chainlink, what should investors be paying attention to? Obviously seeing more projects/apps selecting Chainlink is one KPI. Someone like Docusign or other trusted enterprise companies running a node, too.
(1) What do you think the coming 6 months will look like and (2) what would be big negative indicators for Chainlink making it?
