Sam Reynolds

<div id="highlights-block_610b43eb663bc" class="highlights">
 <ul>
 <li>DeFi relies on real-world data for smart contracts and that’s often validated through Chainlink, one of the world’s largest oracles </li>
 <li>Oracles, data gateways between the real world and the blockchain, are computationally intensive and require secure networks. Swisscom has both. </li>
 </ul>
 
</div>



Swisscom, one of Switzerland’s largest telecommunications companies, announced today that it is joining oracle network Chainlink.&nbsp;



In the blockchain industry, oracles are third-party intermediaries that provide smart contracts and decentralized applications with real-world data that allows for contract execution. Chainlink is one of the market leaders in this space and aggregates price data from multiple oracles to produce what it calls a “consensus value”.



As manipulation of this data could lead to material changes on smart contracts, Chainlink requires a secure network in order to maintain data validity.&nbsp;



In an interview with Blockworks, Sergey Nazarov, the co-founder of Chainlink, explained that for Swisscom this is an <a href="https://cms.blockworks.co/webinars/what-defi-means-for-crypto-market-structure/">infrastructure</a> play to get exposure to the decentralized finance (<a href="https://cms.blockworks.co/the-investors-guide-to-defi/">DeFi</a>) space and broader blockchain industry without having to purchase mining equipment.



After all, Chainlink rewards network participants that can operate at scale and maintain a high level of uptime — something that Swisscom can do by virtue of being a telecom.



“Chainlink is a system that rewards highly reliable node operators,” Nazarov said.&nbsp; “[It allows telecoms to be a] winner doing the things they already do, which is providing high uptime and high security for infrastructure. That&#8217;s the distinction because our system doesn&#8217;t compensate people based on ownership of mining equipment or ownership of tokens.”



T-Systems, a subsidiary of Deutsche Telekom, parent of T-Mobile, also runs Chainlink nodes. Both Swisscom and T-Systems are already large IT service providers for the financial industry in Switzerland and Europe.



Effectively, for the companies, this is the beginning of a shift to the era of decentralized finance by simply replicating what they offer to the traditional finance space.&nbsp;&nbsp;



Swisscom’s digital asset team sees no end in sight to the growth of decentralized financial applications, the company said in a statement.&nbsp;



Nazarov explained that this is a good matchup for telecoms as the Chainlink system doesn’t “compensate people based on ownership of mining equipment or ownership of tokens,” but rather creates a “virtuous cycle” of rewards for data that’s delivered securely.



“If you&#8217;re great at delivering reliable infrastructure, that&#8217;s the model if you want to participate in,” he said.  Chainlink, the twelfth biggest token by market cap, is currently trading at $23.04 down 4.1%, <a href="https://www.coingecko.com/en/coins/chainlink">according to CoinGecko</a>.



Want more investor-focused content on digital assets? <a target="_blank" href="https://cms.blockworks.co/events/digital-asset-summit-2021-2/" rel="noreferrer noopener">Join us</a> September 13th and 14th for the Digital Asset Summit (DAS) in NYC. Use code ARTICLE for $75 off your ticket. <a target="_blank" href="https://cms.blockworks.co/events/digital-asset-summit-2021-2/" rel="noreferrer noopener">Buy it now</a>.

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