Band Protocol
Band Protocol is a decentralized, cross-chain data oracle that provides safe and scalable interoperability across smart contract platforms and real-world data sources. It plays an essential role in obtaining and aggregating data from many blockchains, cryptographically validating it, and then packaging it in an easy-to-use format.
Band Protocol is at the forefront of the decentralized oracles that power blockchain, with features like monetized data provision, a random function that can be verified, and real-time price information.
Band Protocol was first built on Ethereum's blockchain, but in 2020, it moved to Cosmos using its innovative SDK to take advantage of the network's low gas fees and optimized costs. By integrating with Cosmos, developers can unlock cross-chain features using the Cosmos Inter-Blockchain Communication (IBC) protocol.
Soravis Srinawakoon, Paul Nattapatsiri, and Sorawit Suriyakarn, three MIT graduates, started Band Protocol in 2017. Srinawakoon became interested in cryptocurrencies after learning that MIT "airdropped" $100 worth of bitcoin to all undergraduates who participated in a survey. Back then, students got 0.3 BTC.
Srinawakoon and his friends created a gambling website for cryptocurrencies that also served as a bitcoin faucet. Users who won casino-style games were awarded bitcoins. Srinawakoon sold the website and invested the money on the development of Band Protocol.
Band Protocol was first launched on the Ethereum blockchain in 2017. The main net went live on September 30, 2019. In 2020, however, Band Protocol 2.0 was developed on its own blockchain, BandChain, utilizing the Cosmos SDK.
In the industry, there are numerous data providers. But there's no way to be sure that data is accurate. Real-world data is essential to the success of a number of DeFi protocols, yet relying on a single data provider can be counter-effective for smart contracts.
To make sure that DeFi protocols are truly decentralized, they can use truly decentralized oracles like Band Protocol. Decentralized oracles are superior to centralized oracles for providing real-world data to smart contracts due to their decentralized nature of operation. Band Protocol states its mission on its website as follows:
"Band Protocol reduces the centralized effect of the oracle problem by enabling smart contracts to link to any off-chain data stored by community-governed data providers in a reliable, safe, and efficient manner."
The increasing influence of decentralized apps makes it clear that demand for decentralized oracles will continue to be significant in the future. This is the market that Band Protocol wants to get a share of with its decentralized cross-chain oracle network. The main goal of the Band Protocol is to make it easy for decentralized applications to use data from the real world. They maintain data integrity using economical means, especially through their BAND tokens.
BandChain relies on three participant groups for its operation:
Validators: The primary responsibility of validators is to propose and commit new blocks as part of BandChain's consensus mechanism. They do this by securing a validator node using BAND tokens. Only the top 100 validator candidates who have staked the most BAND tokens can become validators. These validators function in the same manner as other DPoS initiatives in the Cosmos ecosystem.
Delegators: In contrast to validators, delegators are not required to run a node. Instead, they contribute to network security by delegating BAND tokens to validators in exchange for staking incentives.
Data Providers: The Laozi Main net Band Protocol update has enabled on-chain payments. Consequently, data providers can earn income gathered through data queries. This kind of incentive helps to improve the quality of Oracle data on the network.
BandChain's native token, BAND, is the only token that can be used on its network. BAND is used to protect and power the decentralized oracle network. It can be used for:
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Collateral/Stake for Validators: All validators are required to stake BAND, with a higher stake indicating a greater likelihood of being selected to complete data requests. The tokens of ineffective or harmful actors will be reduced.
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Transaction and Access Fees: BAND tokens are used to pay for transactions, queries, and data access behind paywalls (private APIs).
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Participation in BandChain Governance: Token holders can vote on protocol updates and parameter changes on BandChain. The governance process gives token holders the power to make decisions about the direction of the network.
DATE NEWS/EVENTS IMPACT 03/11/2022 Band Protocol has revealed its plans to upgrade its main net +145% Increase 07/05/2022 TerraUSD and LUNA both collapsed, and as a result, a number of crypto platforms folded in the aftermath -48% Decrease 05/08/2020 Band protocol rises after Coinbase listing and partnerships with DeFi platforms +198% Increase
Data oracles are crucial to the development of DeFi. The Band Protocol network contributes to the scalability and development of the sector by offering a means for smart contracts and the decentralized economy to access off-chain data.
Band Protocol is expected to become a genuinely decentralized and trustworthy data oracles provider as it continues to roll out its main net in phases and scale, and it may even surpass its strongest competitor, Chainlink, due to its low price and great speed.
