AdEx Integrating Chainlink Oracles for Validator Uptime Verification and Publisher Staking

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Posted by AdEx Network on August 6th, 2020

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We are thrilled to announce that we are integrating Chainlink’s market-leading decentralized oracle network to further enhance the services available through the AdEx staking portal. Chainlink is a proven oracle solution that can provide Adex users with strong security and reliability guarantees when determining the uptime of validators and proving ownership of publisher domains.

How Oracles Can Enhance AdEx

If you have been following us, you know that AdEx is an advertising network with no intermediaries, which ensures less fraud, and with no cookies or tracking. It’s built on payment channels that run on the Ethereum blockchain, and as of mid 2020, we are the largest payment channel network in terms of total transactions processed.

While AdEx depends heavily on real world data such as domain ownership, website content, and categorization, etc., most of the heavy lifting is done off-chain thanks to the payment channel system OUTPACE.

However, there’s a part of the AdEx ecosystem that depends on external data being available on-chain entirely: the staking module. There, our native ADX token is staked to ensure that the ad platform runs smoothly — it is implemented to protect it from various events such as validators going offline or publishers losing their domains. An important part of this staking module is slashing — taking away a portion of staked tokens to punish the occurrence of such events.

Because these oracles form the backbone of our crypto-economic incentive model, we will be using Chainlink’s oracle network to verify slashing conditions for enhanced security and decentralization. Chainlink has a large collection of secure node operators run by leading DevOps teams, and provides a decentralized architecture so users obtain high availability and manipulation resistant enforcement of staking conditions. Additionally, the flexibility of their infrastructure allows us to get data from any off-chain source to be used for on-chain verification.

“The AdEx staking module is an integral part of our ad platform, and it also has a secondary DeFi function: it allows ADX token holders to participate in our ecosystem and earn rewards,” said Ivo Georgiev, CEO of AdEx Network.

“This is why we needed to select an oracle provider that is reliable, trustworthy, and secure. As the industry standard that has proven to secure nearly a billion dollars in value, Chainlink was the obvious choice,” Georgiev added.

Validator Uptime Verification

Validators on the AdEx platform have the vital role of confirming impression quality and then distributing payments via payment channels. They are required to run 24/7 — if a validator goes offline, all ad campaigns processed by it are temporarily frozen until the validator is back up.

To disincentivize this behavior, each validator has a pool of ADX tokens staked against it - these indicate the trustworthiness of the particular validator. The fees that the validator collects are distributed proportionally to the stakers in this pool, but the stake is also slashed in case of a service disruption.

Chainlink oracles will be used to verify that validators have experienced downtime, and subsequently trigger a slashing penalty to the staked ADX tokens. In the future, it will work in conjunction with our upcoming Registry system built on Substrate/Polkadot.

Publisher Staking

In addition to using ADX tokens for validator staking, we are planning to add a new functionality to our staking portal in Q4 of 2020: publisher staking. With this feature, a publisher will be able to stake ADX tokens to increase their reputation within the AdEx platform. The more ADX they stake, the more assurance we have their traffic is of high quality.

In this instance, slashing would be used as a penalty against publishers for losing the ownership of their domain name, which usually indicates they’re no longer maintaining this website, or worse — the website has been hijacked. This feature is mainly aimed towards crypto publishers, allowing them a way to demonstrate trustworthiness via economic incentives.

For this integration, we will be using Chainlink’s oracles to request and receive data in order to verify the publisher’s domain ownership by calling into Cloudflare’s DNS over HTTPS. This will allow for a trustless way to verify publisher ownership, as well as enable automatic slashing in the event of domain loss.

These use cases — deploying oracles to ensure validator uptime as well as verify website ownership — are among the first of their kind. We believe they are strong steps towards revolutionizing the online ad space.

About Chainlink

If you’re a developer and want to connect your smart contract to off-chain data and systems, visit the developer documentation and join the technical discussion on Discord. If you want to schedule a call to discuss the integration more in-depth, reach out here.

Chainlink is an open-source blockchain abstraction layer for building and running decentralized oracle networks that give smart contracts on any blockchain access to secure and reliable data inputs and outputs. It provides oracles to leading DeFi applications like Synthetix, Aave, and Kyber Network; numerous blockchains such as Ethereum, Polkadot, and Tezos; as well as large enterprises including Google, Oracle, and SWIFT.

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