Each fan stakes one bitcoin, and they create a smart contract that will rely on a trusted, machine-readable data source - the ESPN sports wire - to learn who has won the game. Murck gives an example: Let's say that two baseball fans want to bet on the outcome of a game between the New York Yankees and the Boston Red Sox. In many cases, a single source won't be enough.
"And I still believe that's true."ĭriving the business model will be the need for reliable data sources. "Oracles are the new miners in the blockchain world," Patrick Murck, special counsel at the New York law firm Cooley, recalls saying at a conference last year. The network is designed to empower an emerging business model in which oracles will be paid for what they offer, just as cryptocurrency miners are. This isn't something on a whiteboard somewhere," Nazarov said. SmartContract has been developing ChainLink for the past three years. To that end, he hopes soon to launch a network called ChainLink, in which various node operators will function as sellers of data or payments capabilities, and will be paid in LINK tokens, a new digital asset Nazarov intends to roll out this year. Nazarov sees his company instead as "an accelerant," connecting disparate systems. SmartContract, despite its name, is not actually in the business of writing smart contracts. If all goes well, 11,000 banks will eventually be able to use smart contracts to initiate payments. SmartContract is already having concrete discussions with Swift about phase two of the implementation, according to Nazarov, and Nolan said her organization looks forward "to exploring potential opportunities to work together in the future." The partnership so far amounts to "a successful proof of concept," Hazel Nolan, Swift's project manager for Innotribe innovation programs, said in a brief email. SmartContract's work with the Society for Worldwide Interbank Financial Telecommunication came about after the startup won the organization's Innotribe Industry Challenge earlier this year. "Without data inputs and without payment outputs that users want to receive, it's difficult to imagine a financial agreement of any worth," said Sergey Nazarov, SmartContract's founder and CEO. That is meaningful because, if a smart contract can respond to a Swift message, it can send money in dollars or yen, not just in cryptocurrency. SmartContract recently completed phase one of an implementation with Swift that will allow banks' back-office Swift systems to talk to smart contracts. The startup didn't invent the concept, nor is it the only company trying to enable smart contracts with real-world applications. SmartContract has made building better oracles its mission.