Coinbase Cloud, which provides blockchain infrastructure for crypto companies, is joining decentralized oracle network provider Chainlink as a node operator as it looks to help improve the sectors underlying technology.
The infrastructure provider tied to the U.S. crypto exchange Coinbase is the latest of several high-profile names to become node operators, including T-Systems Multimedia Solutions, a subsidiary of T-Mobiles parent company, Deutsche Telekom. Coinbase Clouds contributions as a node operator will bolster the technology, according to Kai Zhao, the group product manager at Coinbase Cloud.
Our participation in Chainlinks Decentralized Oracle Network is a statement of our commitment to the security and reliability of smart contracts, Zhao said in a statement. We believe on-chain is the next online, and we look forward to working with Chainlink to further this future.
In the past couple of years, Chainlink has expanded its dominance in the crypto industry with high-profile integrations across networks, services, and with organizations such as the National Basketball Association, which uses the technology for its dynamic NFTs.
Chainlink, as the name implies, is a link from the blockchain to outside world data, which is often used to build robust smart contracts that deal in everything from crypto loans to insurance.
Smart contracts on their own cant access data outside the blockchain so Chainlink helps by bringing together data from several off-chain sources, called oracles, and sending it back to the blockchain. In theory, this is safer than if a single oracle was called on for the data because they would control it all. If a smart contract requires accurate prices of a cryptocurrency, for example, Chainlink enables its decentralized network of price oracles to find a consensus of the current price, which it reports back.
But to bring the data of these off-chain oracles together, Chainlink requires nodes run by individuals or companies to agree on the accuracy of the data before providing it to be used by smart contracts.
By joining as a node operator, Coinbase is helping blockchain technologys underlying infrastructure improve, according to Johann Eid, the vice president of Go-To-Market at Chainlink Labs, the company that helps support Chainlinks technology.
How do you grow the space? You grow the infrastructure, Eid told Fortune. Thats what theyve been doing for years.
