A concrete example
A lending application uses a price feed to value collateral.
In context
Chainlink provides oracle networks and services rather than a base chain equivalent to Bitcoin or Ethereum. Off-chain components gather and process information; contracts expose results on supported networks. The exact sources, operators and update rules depend on the service.
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Chainlink
Chainlink and the oracle problem
A lending contract needs collateral prices, but its blockchain does not natively know every market price.
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