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Chainlink CCIP: The Power Of A Global Standard

On the latest episode of the Bell Curve podcast, Chainlink co-founder Sergey Nazarov joined host Mike Ippolito and Framework Ventures co-founders Vance Spencer and Michael Anderson to talk about how Chainlink stays ahead of the curve, creating decentralized oracle services that power increasingly advanced use cases for smart contracts and tokenized assets with an unrelenting focus on maintaining the highest level of security.

Nazarov elaborated on what sets Chainlink’s Cross-Chain Interoperability Protocol (CCIP) apart from other bridges as the first token and data transfer protocol capable of uniting decentralized financial (DeFi) applications with traditional financial (TradFi) institutions and market infrastructure providers into a single standard enabling a global internet of contracts.

Firstly, CCIP facilitates programmable token transfers that allow tokenized assets to be transmitted with instructions for how they should be used on the destination chain. Furthermore, CCIP achieves the highest level of cross-chain security and features a separate Risk Management Network that continuously surveils cross-chain functions for erroneous activity.

“You can essentially encode various policies that determine how value can move and this will actually be the crux of how value will move over CCIP between the traditional financial system – all the big banks, all the big asset managers – and DeFi,” Nazarov explained.

“I personally think that this is one of the main goals of a successful cross-chain system – there’s the ability to make web3 transactions happen across public chains; there’s the ability to make private chain transactions happen across private bank chains; and then there’s the ability to merge all of those chains into a single internet of contracts.”

He believes Chainlink’s approach to meeting the security requirements of DeFi and TradFi is one of the main reasons CCIP will become a widely adopted standard. 

“CCIP is built across two sets of requirements – it’s built across the web3 requirements and the capital markets requirements, and the reason it’s built across both sets of requirements is because the capital markets are where the money is,” he explained. “Fundamentally all DeFi protocols will simply want the most TVL, the most usership, the most adoption.” 

Ultimately, a shared standard ensures all of the world’s value can eventually be brought onchain to transact in a more secure, reliable, transparent, cryptographically guaranteed, blockchain-based format. 

“My fundamental goal is to make the blockchain industry and the blockchain, smart contract, oracle network-powered format the format for all value,” Nazarov said. “And you’re just not going to achieve that goal unless you create an efficient path for all of the world’s value to flow into that format.”

Watch the full episode. 

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