Why is ChainAPI a major iteration of the oracle API market Honeycomb?
Written by: LeftOfCenter
As a brand new oracle model, API3, a first-party oracle solution, launched a new service called ChainAPI a month ago, and announced the abandonment of the previous Honeycomb Marketplace. The API3 development team said, ChainAPI is a major iteration of Honeycomb.
So, what is ChainAPI? What is wrong with the original Honeycomb? What does the launch of ChainAPI mean for API3?
What is ChainAPI?
ChainAPI is a new API integration platform launched by API3, which allows API providers to integrate first-party oracles more conveniently. In other words, with ChainAPI, API providers in the API3 ecosystem can more easily integrate APIs to API3. Oracle system.
This means that API3 provides a standardized API integration solution, and API providers can independently complete the API integration with Airnode. Of course, if necessary, the full-time staff of API3 can also use the ChainAPI interface for integration on behalf of the API provider, thereby greatly improving the efficiency and accuracy of oracle integration.
In addition to providing an optimized integration experience, ChainAPI also simplifies the process of interaction between the “API provider” and the “requester” based on cross-chain and multiple Airnode protocols (for example, setting custom authorization policies for oracle endpoints, The wallet provides funds to satisfy requests, etc.).
What is Honeycomb?
So, why is ChainAPI a major iteration of Honeycomb? First, you have to figure out what Honeycomb is? And what functions are provided?
Honeycomb was developed by CLC Group team, was born about two years ago, as an oracle API market, it focuses on the intelligent connection contract developer, Chainlink node operators and API providers, aims to model in a software as a service , To provide external adapters for Chainlink node operators.
In other words, API3’s development team CLC Group originally served Chainlink oracles, and hopes to guide and incentivize external data providers to submit high-quality data to Chainlink by building an ecosystem involving multiple participants. To achieve scale expansion and network effects, Honeycomb acts as a neutral oracle API market in this model and is also the center of the system.
The good and bad of Honeycomb
But two years later, CLC Group announced that it would abandon Honeycomb, and replaced it with the launch of a new service, ChainAPI, and said that ChainAPI was a major iteration of Honeycomb. So, what is the problem with Honeycomb?
Before asking the question, let’s take a look at what is worthy of recognition in Honeycomb?
According to the official announcement issued by CLC Group, although Honeycomb is about to be obsolete, Honeycomb also provides very useful practical experience for API3, has achieved good results in many aspects, and laid the foundation for the launch of a new ChainAPI.
In the past two years of practice, Honeycomb has achieved some good results in oracle integration, such as a user-friendly seamless integration experience, which not only simplifies the integration of oracle and dApp to a minimum, but also achieves predictions through the tool set The seamless integration of the machine node and Honeycomb directly provides a lesson for designing the user experience of the Airnode deployment program.
Airnode is a kind of node designed for the first-party oracle, and is essentially a blockchain API gateway . As a lightweight cloud service infrastructure, it encapsulates the API backend and abstracts all functions to allow users to access it through the Internet. In addition, it also provides other features, including authorization, caching, and rate limiting .
Like the oracle node, the function provided by the Airnode gateway is to provide API data to the smart contract, but for API providers, this method is easier to use, especially for those who are familiar with deploying cloud service hosting. For. Airnode can provide a unified service for API data providers. Data owners can set up an API gateway to connect to Airnode by themselves. With just one click and DNS configuration, they can use cloud hosting services to provide data without subsequent and daily operations.
Like the oracle node, the function provided by the Airnode gateway is to provide API data to the smart contract
However, in the past two years of trial and error, the team has gradually discovered that the original model that required the participation of all three parties has architectural flaws. This architecture is not only very complicated, but also unable to achieve integration in a way that minimizes trust. For the key point, this model also has flaws in the business model.
In the original architecture of API3, there are three parties: oracle node, dApp (demand side) and API provider. Among them, Honeycomb acts as a middleman , aiming to connect “API providers” and “oracles” through powerful market forces . “Node” realizes integration. The team hopes to use this as an initial model to guide the platform to achieve a cold start, and then gradually transform into a trustless integration path solution. However, the team later discovered that in a model where all three parties need to participate, three different parties must participate in coordination every time. This model proved to be very complicated , and the only option to integrate the oracle with minimal trust is API providers operate the full nodes of the oracle by themselves . In addition, Honeycomb also verified that the team’s previous assumption that “the oracles and dApp applications are the two highest priority parties” is not completely correct. Instead, it should be replaced by ” The API provider is regarded as a key component of the oracle solution” . This directly led to the birth of API3 in the first-party oracle model.
More critically, Honeycomb has some flaws in its pricing model:
- The oracle node needs to pay the gas cost of the data requester, and the cost is uncertain.
- Related to the above, Honeycomb uses a static service pricing model, but the gas price, ETH price, and gas cost for implementing dynamic pricing on the chain are all uncertain
- Requires off-chain coordination to update pricing parameters (this is especially difficult for this kind of tripartite model)
- Using tokens to pay will cause friction, and the pricing model is not flexible enough compared with the traditional API provider pricing model, and it cannot be customized
This made the team realize that the iterations of minor repairs are useless at all, and can only be completely improved from the architecture, and the oracle node/protocol can be solved fundamentally from the beginning.
What changes has ChainAPI made?
In the improved version of the architecture, the oracle node operator that was originally an intermediary is removed, and the model that includes three parties (the oracle node, the dApp “demand side” and the API provider) is simplified to a model that only requires two parties to participate ( API providers and dApp), but since then no longer need to provide API market Honeycomb oracle and oracle who node as a link API, new ChainAPI serve as a tool integration API, providing API3 ecology API Provide a simple and easy-to-use self-service integration solution to integrate it into Airnode to create a first-party oracle. This not only greatly reduces the complexity, but the API provider runs the node itself to minimize trust.
In summary, the end of Honeycomb and the launch of ChainAPI mean that the API3 team is gradually improving the development and delivery of the first-party oracle model and function. This will greatly simplify the integration of API providers into Airnode and help API3 accelerate the expansion and In addition, the two-party model without the role of third-party nodes can not only minimize trust, but also reduce the cost of oracles after removing the middleman.
Reference source:
https://medium.com/api3/airnode-the-api-gateway-for-blockchains-8b07ff136840
https://www.clcg.io/whitepaper/
https://medium.com/api3/hello-chainapi-e1b386a74f1d
https://medium.com/clc-group/sunsetting-honeycomb-and-a-retrospective-ba3f58268024
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