Plugin on XDC × Chainlink on ETH

Introduction

PLUGIN on XDCNetwork

If you're interested in XDC, be sure to explore PLI as well. PLI is the native token of the decentralized oracle plugin on the XDC network. The relationship between XDC and Plugin is similar to that of Ethereum's decentralized oracle Chainlink (LINK). The fact that the price of PLI is rising alongside XDC's surge is attributed to people understanding this connection.

XDC + PLUGIN in Dubai

XDC and Plugin are based in Dubai, UAE, within walking distance of each other. The Plugin team has been developing oracles in tandem with the XDC team, sharing information constantly. XDC and Plugin are true "goto partners," walking together. The need for decentralized oracles on the blockchain is evident. Chainlink, a pioneering decentralized oracle, holds a significant share in the blockchain space.

Why Multiple Oracles Are Needed

However, even with Chainlink's presence, it doesn't mean that other oracles are unnecessary. This is because it gives rise to new problems. If Chainlink were the sole option, its existence would become a single point of failure. Meaning, if Chainlink goes down, the entire blockchain system becomes inaccessible. To prevent this, using multiple decentralized oracles becomes crucial for future blockchains.

From Chainlink to Plugin

While XDC Network once considered Chainlink as a partner, that was before Plugin's inception. The emergence of Plugin, a decentralized oracle perfectly suited for the XDC network, has solidified XDC and Plugin as indispensable partners. The fact that PLI's price is rising along with XDC's surge is due to people understanding this fact. However, only a few are currently aware of it.

Now, let's delve deeper into the comparison between Plugin and Chainlink, specifically focusing on data feed usage fees.

Data Feed Usage Fees

When using Chainlink's data feed, the LINK token fee (oracle fee) is waived by major exchanges that sponsor it. This implies that users, paying fees on major exchanges, might actually be paying as LINK fees.
Therefore, the cost of using Chainlink's data feed effectively becomes only the Ethereum gas fee.

Chainlink's Data Feed Usage Fee

However, Ethereum gas fees can be quite high. As of now, for the ETH/USD data feed, the gas cost from a specific node is $6.36.

Hence, Chainlink's data feed usage fee looks like this:

Plugin's Data Feed Usage Fee

In contrast, Plugin's data feed usage fee is nearly negligible for XDC network transactions. Moreover, transactions on the XDC network are fast and secure.

Plugin's oracle fee for a single API data retrieval is 0.1 PLI. At the time of writing, 1PLI costs $0.13, making the oracle fee only $0.013 (0.1 PLI).

Hence, Plugin's data feed usage fee looks like this:

When PLI is $0.13

Therefore, as of the current date (2023/08/15), the price of PLI is $0.13, and the Oracle fee is 0.1 PLI. The cost to obtain the ETH/USD price is as follows:

If PLI is $1.30 (×10)

Now, what happens if the price of PLI increases? Let's examine. Let's consider the data feed usage fees if the price of PLI increases by a factor of 10 from the current $0.13 to $1.30.

If PLI is $13 (×100)

Taking it further, let's explore the scenario where PLI's price increases by a factor of 100, making 1 PLI worth $13.

XDCNetwork + Plugin remains significantly cost-effective even in this case❗️

Plugin Validator -Flexibility of Costs-

If you're a DeFi operator, you'd likely want to utilize feeds with lower Oracle fees. In the case of Plugin, the Oracle fees can be determined by the validators and the Plugin aggregator picks the validators based on their reputation and provides a decentralized aggregated price at a lower price. Consequently, it's reasonable for validators to aim to lower their fees to attract more usage. At least, that's what I would do.

Plugin Validator -Healthy Price Competition-

The option of validators determining their oracle fee brings in a healthy competition based on pricing. For the time being, if it's a single API request (fetching data from a single API), the fee might be around 0.1 PLI. However, as the price of PLI rises, it's as simple as lowering the cost from 0.1 PLI to 0.08, 0.05, 0.03, or even 0.01 PLI. By that time, validators should be making ample profits 😊.

When Oracle Fees Are Lowered

Now, let's consider a specific scenario where a validator lowers the Oracle fee from 0.1 PLI.

When compared to Chainlink, you can see how cost-effective data feed usage with Plugin is. And remember, don't overlook the fact that it's also faster and more secure.

Unalterable Gas Costs for Chainlink on Ethereum

However, what about the combination of ETH and LINK? Even if major exchanges sponsor the Chainlink data feed service for free, reducing Ethereum network gas costs is not an easy task.

Enabling Access to the Web3 Realm with Plugin

Most importantly, Plugin's decentralized oracle on the XDC Network doesn't just enable financially well-off entities like those using Chainlink on Ethereum. It also opens the door to enter the Web3 realm for small and medium-sized enterprises with limited funds. This is facilitated by the exceptional cost-effectiveness and cost-efficiency of XDC Network + Plugin.

By utilizing the features of XDCNetwork + Plugin, even small and medium-sized enterprises or projects with limited funds can enter the world of Web3 technology, opening the door for them. This will lead to the full-fledged arrival of the Web3 world. Plugin is truly a game-changing presence.

Additionally, Plugin is upgrading its nodes from 1.0 to 2.0 to further enhance projects. Plugin 2.0 breaks down barriers between chains, introducing cross-chain compatibility for interaction and integration across multiple EVM chains. It evolves into a decentralized oracle with numerous added features.

Plugin's CEO, Vinod Khurana, repeatedly mentions that Plugin is advancing projects with a vision 20 years into the future. Enjoy the fantastic journey ahead and keep an eye on decentralized oracles on the XDC Network.

Author: @11ppm