Deutsche Telekom AG, Europe’s largest telecommunications company is now one of the main data providers to Chainlink, the ubiquitous oracle service that decentralised finance (DeFi) relies on extensively.
Coindesk reports that Telekom subsidiary T-Systems Multimedia Solutions (MMS) says it has started staking on the Flow Network, the ultra-scalable proof-of-stake (PoS) blockchain from CryptoKitties creator Dapper Labs. In addition, the company is said to be planning to start staking on several other chains in the near future.
Deutsche Telekom wants to increase its engagement on public blockchains
Deutsche Telekom offers DeFi data support and has quietly moved beyond helping with PoS blockchain infrastructure and has actually started stashing, staking and earning crypto rewards.
Commenting on this development, Andreas Dittrich, Head of Blockchain Solutions Center at Deutsche Telekom, said:
‘We started doing all these enterprise blockchain proofs-of-concepts about five years ago, like everyone else. But gradually we felt we weren’t focusing enough on public blockchains – that’s where digital assets will move in the future and that’s where a telco should really be active.Andreas Dittrich, Head of Blockchain Solutions Center at Deutsche Telekom, via Bitcoin-Bude
T-Systems already operates the third largest Chainlink node
T-Systems announced it was running a Chainlink node last summer, right around the time DeFi basically blew up. Since then, it’s been “a hell of a ride,” Dittrich admits.
We really jumped into something new by providing public blockchain infrastructure with a token-linked business model on top. So of course we started very small, with a few data feeds. But then we scaled quickly and now I think we are among the top three data providers on the Chainlink network.
Chainlink’s system of data feeds, known as oracles, funnels information into the blockchain world of smart contracts, eliminating reliance on a single, centralised source.
We offer 51 data feeds right now. We don’t select applications that we provide data to, but examples would be Synthetix, a couple of decentralised exchanges and Nexus Mutual for insurance. The data is mostly prices for digital assets, foreign exchange rates and commodity prices like gold, silver, etc. and these mostly go to Synthetix.Gleb Dudka, an analyst at T-Systems via Bitcoin-Bude
According to the network’s co-founder, Sergey Nazarov, it is only a matter of time before other large companies follow Deutsche Telekom’s example and operate Chainlink nodes.
Chainlink allows top infrastructure teams like T-Systems to monetise their globally distributed infrastructure and security expertise across the many chains already served by Chainlink oracles.
Holding cryptocurrencies is challenging for businesses
Providing complex infrastructure for the internet is something Deutsche Telekom has been doing for decades (it’s also worth noting that the telco has its own cloud offering, reducing its reliance on AWS). So, on the surface, it should come as no surprise that Deutsche Telekom is providing infrastructure support for the nascent “Internet of Values”.
However, Dittrich admits that the line between IT services and financial services is blurring in interesting ways.
The most difficult thing, he says, was getting a grip on the whole thing legally, risk-wise and tax-wise. T-Systems works with Bankhaus Scheich as a broker and the Berlin-based crypto-custodian Finoa, one of many German companies waiting for a crypto-custody licence from BaFIN. In doing so, such pioneers are entering uncharted territory in the corporate world, which presents them with many legal questions and issues. Dittrich explained:
‘It’s quite a unique thing because our business model means we have to be able to handle crypto tokens. We have to have different types of crypto tokens on our balance sheet. And managing that is a difficult thing for a company like us.
Telecoms plan to pile on Ethereum, Polkadot and Tezos
Dittrich said his team has been busy looking at a number of other crypto staking candidates. The elephant in the room in this case has to be Ethereum 2.0 Staking. Ethereum is the largest blockchain after Bitcoin, which is currently in the first phase of its transformation to PoS.
No Ethereum 2.0 staking yet
The ETH that T-Systems is already buying, however, are needed for Chainlink, according to him. They are needed to authorise transactions on the public Ethereum blockchain. However, Dittrich added:
There are a whole bunch of networks in the pipeline that we plan to go live on. Obviously, the larger proof-of-stake networks are among them, which are Tezos, Polkadot and Ethereum 2.0.
Source: CoinDesk, Bitcoin-Bude
Linkedin: Robby Schwertner