Discover Band Protocol: A Decentralized Oracle Network
BAND Protocol is a data oracle platform that supplies services to a range of different blockchain projects. Its Delegated Proof of Stake consensus system enables delegators, validators and nodes the opportunity to stake the platform's native token (BAND) to participate.
Validators collect requests for information that is not stored on the blockchain, commit them to the blockchain, and then deliver them to the DApps that have made the request.
Basics
Blockchain and Decentralized Finance (DeFi) have revolutionized the financial system within a decade. Nonetheless, for DApp developers to succeed, they need easy access to trustworthy and accurate off-chain data. This issue is being addressed by oracles such as Band Protocol, which is rapidly becoming a prominent part of the crypto landscape.
What Is Band Protocol?
BAND Protocol, founded in 2017, is an oracle platform that bridges real-world and on-chain data. The protocol connects APIs and smart contracts, enabling DApps to access and leverage off-chain data. Last year, Band Protocol jumped over to the Cosmos network to decrease gas fees and reduce user costs.
Band Protocol bridges off-chain data and blockchains, acting as an oracle network for DApps. This service enables smart contracts to be triggered based on events and information external to the blockchain, enabling them to function securely, reliably, and in a decentralized manner. With its cutting-edge oracle solutions, Band Protocol ensures access to trusted and transparent data sources.
How Does Band Protocol Work?
Band Protocol employs an independent blockchain named BandChain, created with the Cosmos SDK. Developers can leverage BandChain to develop personalized oracle scripts that deliver off-chain real-world information to DApps and smart contracts. These customizable oracle scripts include specifications like the data itself, the data source, the number of validators required to confirm the data, and the process used to aggregate it.
The process of executing an oracle script follows the flow outlined below:
- A DApp requests data as per its customized oracle script.
- The request is received by a random group of validators, who retrieve the data from the designated data source.
- The data reported by the validators is combined based on the customized oracle scripts.
- The resulting data is stored on BandChain permanently, and an oracle data proof is created.
- The verified oracle data is then transmitted to the requesting DApps or blockchains.
Consensus Mechanism Behind Band Protocol
Band Protocol uses the BAND token, and a Delegated Proof of Stake consensus mechanism is utilized to secure its oracle network. The BandChain blockchain is operated and maintained by over 90 professional and community node operators. To deter malicious behavior, these node operators must stake BAND tokens. As a reward for reliably processing data requests, validators are rewarded with a portion of the query fees and block rewards.
As a BAND token holder, you can join the network as a validator or a delegator. All validators on the BandChain must stake BAND tokens for data integrity and accountability. Holders of BAND tokens can either stake them or have them delegated to validators, who will receive staking rewards and payment for collecting data requests. Furthermore, BAND tokens are also utilized in the protocol's governance system.
What Are the Primary Objectives of the Band Protocol?
Band Protocol's appeal primarily stems from its shift from Ethereum to Cosmos. The project was designed with three key objectives:
- Rapid and scalable processing. The ability to handle large data requests with minimal delay.
- Interoperability across chains. The capability of being compatible with multiple publicly available blockchains, regardless of their underlying technology.
- Versatile data handling. Supporting various means of retrieving and aggregating data through a generic system.
What Strategies Does Band Protocol Utilize to Reach Its Objectives?
The IBC (Inter-Blockchain Communication) protocol of the Cosmos network provides remarkable interoperability and autonomy for blockchains, enabling speedy communication between them. As a result, Band Protocol can associate with and provide services for projects based on various networks, such as Ethereum, Fantom, Avalanche, and more.
The Band Standard Dataset comprises more than 80 separate data feeds sourced from various data providers. Using these decentralized price feeds, blockchain developers can craft more inventive, dynamic, and adjustable products and projects on the blockchain network.
Conclusion
Band Protocol is an expanding oracle provider striving to make Web3 a reality. Developers seeking to join the Web3 revolution can benefit from Band Protocol's offering of rapid, reliable, customizable, and interoperable services.