The open source technology Chainlink operates on the technology of Off-Chain Reporting (OCR). OCR is a stepping step towards decentralization and scalability of Chainlink networks.
The OCR protocol allows nodes to aggregate their information in a single report off-chain using a secure peer to peer network. A consensus algorithm runs during the communication process where each node submits its data and signs it.
A single node then submits the aggregates report to the chain. The aggregate report contains observations of many nodes and is signed by a quorum of nodes.
Ultimately, these signatures are verified on-chain, preserving the trustlessness property of the Chainlink network.
The benefits of this protocol are:
- It reduces the network congestion on the Chainlink oracle network.
- Less gas cost is spent on individual node operators.
- Since data feeds can accommodate more nodes, the node networks are more scalable.
- Each round of data feeds doesn’t need to wait for multiple transactions to be confirmed, and thus the data feeds can be updated in a timely manner.
Chainlink also recently deployed its network on the Solana mainnet. Thus, the developers of DeFi apps on the network will now be able to use seven of Chainlink’s pricing feeds in their products.
