Know How this Oracle Platform is Facilitating Blockchain Communication

Band protocol facilitates the exchange of information between on-chain and off-chain data sources. It offers new use cases for developers to explore which include weather, sports, weather, random numbers, price feed data, and more. It is a data protocol based on the Cosmos ecosystem that facilitates cross-chain solutions.

In September 2019, the Banks protocol was launched on the ERC-20 token but in 2020 it transitioned to Cosmos Network with the release of Band Protocol 2.0. Oracle nodes on BankChain not only relay data but are also involved in block production/validation giving them a double role.

The protocol permits the validators to access off-chain data with the Delegated Proof of Stake blockchain and communicate it to on-chain decentralized applications.

BAND Token

BAND token is the native token of the platform. It is used as a medium of exchange in the ecosystem. The token is utilized as collateral by validators which is used to satisfy the data requests. Also used for paying for private data.

BAND is a staking token. To earn the right to process transactions and add new blocks to the chain the validators have to stake BAND. Through delegation, the BAND holders who are not validators can select to stake their BAND to validators. This makes delegators eligible for a portion of the rewards collected by their chosen validators. Therefore, Band is a Delegated Proof of Stake (DPoS) blockchain.

The token’s inflation rate is between 7% and 20%. Each time a new block is generated by validators tokens are generated. At the time of launch, there were 100 Million BAND tokens available but it has increased due to the inflationary tokenomics dictated by protocol staking parameters.

The tokenomics shows that 25.63 % is allocated to the ecosystem fund. The foundation was allocated 22%. The development team and advisors received 5%. 15% was allocated for private investors and 12.37% were sold during the BAND public sale.

The BAND token allows the holder to participate in the governance protocol. The power of governance is directly proportional to the amount of tokens staked. The more the staking the more will be the voting rights. Delegators are encouraged to take part in governance and if they don’t take part, then their voting power is automatically assigned to the validators delegated.

BAND has a market cap of $213,139,524. It has a circulating supply of 136,839,530 BAND. The token has a total of 141,239,530 BAND. The fully diluted market cap is $220,090,654.

Working on Band Protocol

Band Protocol is a platform that provides Oracle services to different blockchains. It consists of BandChain and various data products. The platform aims to provide cross-chain compatibility and data flexibility. It seeks to facilitate reliable data to a huge variety of public blockchains within a few seconds.

Band protocol is Cosmos-based and is capable of sending the data to other blockchain networks through Cosmos IBC, which is an interoperable communication layer between different blockchain networks.

The protocol also supports one-way bridges which ensures fast data transfers with blockchains unsupported by the IBC. It accommodates different forms of data and various methods of retrieving it. 

Some of the data on Band Protocol is publicly accessible while other is permission and protected by central entities or exist behind a paywall.

BandChain: BandChain provides the infrastructure for decentralized applications. It performs two types of work. The first is a request for off-chain data and the second is retrieving that data from a third party and providing it further to the dApps.

When the smart contract-based dApps request data, it uses the oracle script and that is similar to the codes of smart contracts. The Oracle script sends the request to the validators who retrieves the data and sends the script for finalization. The validators get paid for this work.

So BandChain can pull data from external sources and aggregate the data in such a format that is easy to use. It is crafted to be compatible with different smart contract platforms.

Band Standard Dataset: The band standard dataset is a collection of commonly requested datasets for crypto and fiat currencies. It minimizes gas fees and offers flexibility to assure accuracy.

Why is Oracle Solution needed?

Oracle solution acts as a middle layer functioning between the decentralized applications and different data sources. Its task is to confirm that smart contracts have access to APIx and data sources outside of the blockchains.

On centralized exchanges, most of the trading activities happen off-chain. Without a third-party tool, smart contracts cannot get the trading price information. And this makes it impossible to confirm that all the funds are safe and the burrower does not lose money using the protocol. This raises the need for an Oracle solution. 

Hence, to access the real-world information available outside the network, oracle is needed by blockchains. It is a way to enhance smart contract functionalities. Band protocol facilitates decentralized oracle service which is secure and robust.

Adarsh Singh is a true connoisseur of Defi and Blockchain technologies, who left his job at a “Big 4” multinational finance firm to pursue crypto and NFT trading full-time. He has a strong background in finance, with MBA from a prestigious B-school. He delves deep into these innovative fields, unraveling their intricacies. Uncovering hidden gems, be it coins, tokens or NFTs, is his expertise. NFTs drive deep interest for him, and his creative analysis of NFTs opens up engaging narratives. He strives to bring decentralized digital assets accessible to the masses.Adarsh Singh is a true connoisseur of Defi and Blockchain technologies, who left his job at a “Big 4” multinational finance firm to pursue crypto and NFT trading full-time. He has a strong background in finance, with MBA from a prestigious B-school. He delves deep into these innovative fields, unraveling their intricacies. Uncovering hidden gems, be it coins, tokens or NFTs, is his expertise. NFTs drive deep interest for him, and his creative analysis of NFTs opens up engaging narratives. He strives to bring decentralized digital assets accessible to the masses.