At the Avalanche Summit in Barcelona, Spain, Chainlink co-founder Sergey Nazarov virtually joined the founder of Ava Labs (a team supporting the development of Avalanche), Emin Gün Sirer, to examine how Chainlink oracles and Avalanche’s high-performance, high-capacity blockchain enable the future of web3. Nazarov and Sirer highlighted three use cases they’re most excited to see flourish.
Since its 2020 launch, Avalanche’s novel consensus mechanism and near-instant transaction finality have turned the low-latency chain into one of the fastest organically growing blockchain ecosystems. Sirer explained why integrating Chainlink oracles marked such an important milestone for the host of next-gen applications building on Avalanche.
“It’s absolutely essential for any blockchain to have accurate data feeds and these feeds are enablers for everything under the sky, especially DeFi,” he said.
Nazarov emphasized the significance of Avalanche’s high speed and maintained uptime when it comes to creating web3 DeFi applications that rival web2 systems.
“High-speed financial applications are the norm for web2, and for web3 to compete and have parity with web2, you do need a high-speed chain or a high-speed set of systems that interoperate to create scalability,” he said.
While DeFi is still the prominent use case, Avalanche and Chainlink also unlock enormous potential in the realm of blockchain-based gaming. This Nazarov, explained, is because a high-speed blockchain system is crucial to creating a fast, exciting user experience.
“You don’t want to wait for a poker hand,” he said. “People don’t really love waiting for that.”
While web3 games do compete amongst each other, Nazarov said the web3 gaming industry is ultimately up against web2 applications.
“That means that we need to arrive at parity for speed and reliability, and then we have all these additional properties of tamper-proofness and private key control,” he said. “Something like Avalanche gets us closer and closer and possibly arriving at parity with web systems’ speed, and for gaming that’s very important.”
Chainlink VRF (Verifiable Random Function) provides a source of decentralized, tamper-proof randomness to on-chain games. “Randomness is a very common requirement for many games, because the fairness of the game is derived from the randomness,” Nazarov said. In his view, true on-demand randomness is as important to gaming as accurate price data is to DeFi.
“Both need to be performant and secure,” he said.
Sirer, an associate professor of computer science at Cornell University and co-director of the Initiative for Cryptocurrencies and Contracts (IC3), emphasized how vital Chainlink VRF’s off-chain random number generation (RNG) is to web3 games.
“RNG is absolutely essential to computer scientists; it seems like a boring or simple thing to non computer scientists, but it’s actually a very difficult problem. In the blockchain space, the generation of secure random numbers is actually very difficult.”
“At Avalanche, we were one of the first people to say to the world, ‘Look, NFTs are not just a bunch of pretty pictures; they’re credentials; they can play a role in the real world and they can do all sorts of exciting things,’” Sirer said.
Chainlink Data Feeds are connecting NFTs to real-world data and updating them in real time to reflect evolving stats and event outcomes, resulting in NFTs that are inherently dynamic (dNFTs). Chainlink Sports Data Feeds, for example, are powering dNFTs that evolve to track Charlotte Hornets point guard LaMelo Ball’s on-court moves moment-to-moment.
“The early version of NFTs kind of have a floating value that people ascribe to them and dynamic NFTs will actually reflect the value in the real world as it happens,” Nazarov said. “And that actually creates a more accurate representation of the value of NFTs by them being dynamic.”
Nazarov said he’s excited to see dNFTs connected to real-world events in industries like financial services, art, and gaming. “Enabling more advanced NFTs with oracles is something we’re looking into very seriously and have seen a lot of progress on.”
Watch the full discussion during Avalanche Summit Day 1, Subnet Stage here.