Developers of the Binance Smart Chain blockchain supporting EVM-based smart contracts are integrating Chainlink oracles to empower the DeFi industry.
The Binance cryptocurrency exchange previously reported that the Binance Smart Chain (BSC) parallel blockchain has “high performance of the main Binance Chain blockchain”, which will allow transactions between the two blockchains due to their compatibility. With this architecture, you can create decentralized apps and tokens on one blockchain and take advantage of the fast trading on Binance DEX on another. So far, Binance Smart Chain is presented as a testnet.
Chainlink co-founder Sergey Nazarov believes that thanks to the integration with Chainlink oracles, Binance Smart Chain developers will no longer have to spend time developing their own oracle infrastructure, which can take several months. Developers can now use Chainlink as an abstraction layer to create secure and versatile smart contracts. Binance believes that this integration will enhance the capabilities of the smart contract-enabled blockchain, especially in the field of Decentralized Finance (DeFi), payments and asset management.
Most blockchains, including Binance Smart Chain, cannot interact directly with external data sources. The developers added that the integration of Chainlink oracles will increase the security level of the BSC environment, but at the same time limit its usability. However, Nazarov noted that having secure oracles is paramount to the DeFi industry. This is evidenced by the recent success of the Aave project using Chainlink oracles. This month Aave launched a new service that allows users to borrow without collateral.
According to Nazarov, the need to simultaneously create their own infrastructure and develop financial products slows down the development of decentralized finance. That being said, the rise of DeFi can be attributed to the growing number of high quality oracles.
According to a recent study by Codefi, a subsidiary of ConsenSys, DeFi app user activity continues to grow. However, most of the time the same people use many products, so their user base cannot be summed up.