Blockchains are deterministic environments, they can only act on data that already exists inside the chain. But most real-world financial applications need external data: what is the current price of ETH in dollars? Has a certain sports result been confirmed? Has a package been delivered? Chainlink is the infrastructure that brings this external data on-chain reliably. It operates a network of independent node operators who fetch real-world data, aggregate it, and deliver tamper-resistant feeds to smart contracts. Without oracles like Chainlink, DeFi lending protocols would have no way to know when to liquidate under-collateralized positions. That foundational role makes Chainlink deeply embedded in the DeFi stack. LINK is the token used to pay node operators.
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