Chainlink plans to launch its long-awaited staking services in December, Sergey Nazarov, the project’s co-founder, announced Wednesday at the Smartcon 2022 conference in New York.
Nazarov said Chainlink will progressively roll out the staking program for particular ecosystem members based on their LINK holdings, community engagement, and ecosystem participation. Chainlink will launch an eligibility app on Oct. 3 to notify users when they are eligible to participate in staking.
Nodes and Stakers
“Staking is going to distribute the value the system accrues to the relevant participants—the nodes and the stakers,” said Nazarov, who described the initial staking programs as “experimental.”
A blog post noted that the first staking program will be available to oracles providing ETH/USD feeds on Ethereum. Staking will expand to support additional feeds in the future.
According to Staking Rewards, LINK’s $3.8B market cap would rank it as the ninth-largest stakable crypto asset by total capitalization.
Chainlink offers oracle networks that relay real-world data to web3 dApps, such as price feeds, weather data, and cross-chain communication. Chainlink’s ecosystem currently spans more than 1,500 projects, including top protocols Aave, Compound, Synthetic, and dYdX.
The Chainlink network includes 1,000 oracles, which have powered $6.18T worth of transactions in 2022 so far.
Staking is one of several programs Chainlink announced at Smartcon as part of its “Economics 2.0” initiative, which are designed to improve the protocol’s economic sustainability. Smartcon is Chainlink’s first physical conference event.
Chainlink announced SCALE, the Sustainable Chainlink Access for Layer 1 and 2 Enablement, on the same day.
The SCALE program allows partner projects to fast-track “smart contract innovation” in exchange for covering operating costs associated with Chainlink’s Oracle networks, such as research and development expenses and gas fees. SCALE participants will access a variety of premium oracle services, such as data feeds with increased update frequency enabling low-latency dApps.
Prominent Layer 1 networks Avalanche, Metis, Moonbeam, and Metis have already confirmed they will participate in SCALE to unlock native advanced oracle functionality.
Chainlink said that dApp user fees can cover oracle expenses as protocols gain adoption. It noted that some oracles on Polygon and BNB Chain are already entirely supported by user fees.
The project also announced BUILD, a program designed to support the development of early-stage projects.
BUILD partners will pledge to commit network fees and between 3% and 5% of their native token’s supply to Chainlink service providers, including stakers, in exchange for access to enhanced Chainlink services and technical support. BUILD partners can deploy custom data feeds, get priority access to alpha and beta versions of new services, and receive expert technical support.
Chainlink ecosystem participants Truflation, Space and Time, and bitsCrunch announced their participation in the program, confirming they will commit “multiple percentage points” of their respective native tokens’ supply to the program.
“LINK just announced they are now also a hedge fund that will own 3-5% of every apps token supply,” Twitter user BuyMoreLink posted in response to the news.
“This alignment of economic incentives between communities helps foster the mutual, long-term success of both ecosystems,” Chainlink said in a Sept. 28 blog post.
Nazarov also announced that Chanlik is working with SWIFT, the global payments system supported by 11,000 banks, to explore utilizing Chainlink’s Cross-Chain Interoperability Protocol (CCIP) for transferring tokens and messages across multiple chains.
“I’m very happy to announce that we are working on an initial Proof-of-Concept together with SWIFT on the use of CCIP in the capital markets to enable communications and the movement of tokens between a number of different institutions in a way that will accelerate the adoption of DLT [and] blockchains,” said Nazarov.
Jonathan Ehrenfeld Sole, SWIFT’s strategy director, noted that the network has been working on pilot programs in partnership with Chainlink for the past five to seven years.