- With the implementation of the Oracles in Etherisc’s decentralized flight insurance companies, Chainlink has gained a new use case.
- Up to now only in the test network, Etherisc retrieves flight data from the decentralized Oracles of Chainlink, in order to be able to settle flight insurances automatically.
By using the Oracle technology through the decentralized insurance protocol Etherisc, Chainlink has gained its first use case beyond price feeds. According to Etherisc, the company has established a working decentralized proof of concept for flight insurance on Rinkeby, an Ethereum test network that receives data feeds from Chainlink.
In yesterday’s blog post, Etherisc describes the problems of the current flight insurance industry and how blockchain can overcome the limitations. According to Etherisc, decentralized data retrieval via Chainlink is the key to developing a safer and highly functional solution.
As Etherisc describes, the current insurance industry is characterized by information asymmetry. In the current model, users have to submit claims manually, which are then processed internally by the insurance company to check whether or not the claim is eligible for compensation according to the specific policy. In case of disagreement, the insurance company has the upper hand, which is usually at the expense of the insured. Etherisc changes this:
By combining the decentralized security of Ethereum with the decentralized oracle framework of Chainlink, users have access to a trust minimized insurance product that is secure end-to-end.
Etherisc and Chainlink create transparency within the insurance industry
By using the Ethereum blockchain and smart contracts, the processing of applications can be decentralized, transparent and fully automated. The smart contracts enable the conditions of an insurance contract to be converted into a digital logic that is executed on the basis of predefined conditions that cannot be manipulated by any party.
However, the core problem so far, as Etherisc states, has been that trustworthy data (off-chain data) had to be supplied. Therefore, a reliable mechanism for data delivery had to be created that would preserve the decentralization. This is where Chainlink Oracles steps in.It can provide the smart contracts with the necessary off-chain data (e.g. flight times) while maintaining the decentralized consensus.
In Etherisc’s proof of concept, several Chainlink Oracles retrieve data on whether the flight was delayed or not, using an external adapter for the Flightstats API. The responses from each node can then be combined into a single data point.
This allows decentralization of data delivery, which on the one hand protects against downtime and on the other hand provides a decentrally verified result. In the future, according to Etherisc, the number of Chainlink nodes that retrieve data and the number of data providers from which data can be retrieved will be increased.
Until now, Chainlink has been used exclusively to feed off-chain data for price feeds, primarily in the area of decentralized finance (DeFi) applications, such as Synthetix, Alkemi and Ample Forth . The use of the Chainlink Oracle technology for flight data demonstrates a new use case and the huge potential of Chainlink. If the Ethereum ecosystem continues to grow, Chainlink could play a central role as data provider.
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The Chainlink price seems to benefit from the news and is currently, within the top 20 by market capital, the biggest winner in the crypto market with a 13.3% increase.