The main decentralized oracle of the cryptocurrency market and Layer 2 Arbitrum have formed another important association for the blockchain industry. As a result, Chainlink Automation was launched on Arbitrum One. But how does this benefit the crypto market?
First, it is necessary to understand what Chainlink Automation is. The solution is designed to allow Web3 developers to automate key smart contract functions in a decentralized manner.
As such, they can make contracts more attractive while saving time and resources invested in development. Another notable difference is the increased speed of scaling.
With a focus on scalability, Chainlink Automation enables transactions to be quickly identified and confirmed even during periods of network congestion.
In addition to being present on the market leading altcoin blockchain, Chainlink Automation is on BNB Chain, Polygon, Avalanche, Fantom and recently arrived on Arbitrum. The highlights of this latest collaboration are the subject of this article.
Chainlink and Arbitrum
As Niki Ariyasinghe, Head of Blockchain Partnerships at Chainlink Labs, noted, Arbitrum developers will be able to create low-cost, highly scalable smart contract applications in a decentralized manner.
This is a huge milestone for the altcoin, as Arbitrum has been one of the fastest growing Layer 2s in recent months. As an example, major crypto market projects like SushiSwap and Curve already use the scaling solution technology.
Also, Arbitrum managed to stand out during the FTX crash. On December 15, it had a 7.6% rise in TVL.
These developments occur in Arbitrum, since it is an Optimistic Rollups technology. This Layer 2 protocol is designed to extend the performance associated with the Ethereum (ETH) base layer. It allows scaling smart contracts on the ETH network.
Developers can create decentralized applications (dApps) with more features and lower costs by combining Chainlink's smart contract automation solution with Arbitrum.
This partnership is another great new feature that the decentralized oracle brings to its holders with the advent of LINK token staking.
Over the course of 2022, Chainlink was one of the blockchain projects that gathered the largest number of associations around it, and it should continue this trajectory next year. As an example, at the end of November, the oracle made 12 integrations of five Chainlink services on four different networks: BNB Chain, Ethereum, Optimism, and Polygon.
The partnership between Chainlink and SWIFT, an interbank messaging system, was a positive milestone for Chainlink in 2022. This collaboration will enable the decentralized oracle to work with a proof of concept, helping businesses transact on the blockchain. .
Since smart contracts alone cannot get data from off-chain, they need decentralized oracles, and Chainlink manages to be the leading name for this solution.
What reported Per U.Today, LINK could be a major highlight of 2023 as there is a huge need for more real data to enter the blockchain and a huge demand for tokenization from companies in this sector.
Cumulative solutions like Arbitrum's, on the other hand, are showing interest from investors because there is a great need for cheaper, more efficient, and faster blockchain developmentsโvirtues yet to be seen in Ethereum.
Although Ethereum 2.0 does not reach the market, the search for greater scalability, without losing the security of the main network of smart contracts, is intense.
In addition to being designed to enhance ETH smart contract features, bringing more efficiency and cost savings, Arbitrum adds privacy features to these contracts. Therefore, investors and users of blockchain contracts feel more secure in their negotiations.
U.Today also highlighted that with the arrival of Surge in 2023, projects aiming to grow in this area may be among the top choices for investors, and Arbitrum fits as a great option alongside Polygon (MATIC).
