Chainlink VRF – What Is It And How Does It Work?

Blockchain technology is continuously striving to create more secured platforms for its users. A number of safe and user-friendly apps have been introduced in the financial market with the assistance of the blockchain technology. Equipped with the characteristics of smart contract , it provides secured transactions to the users now. These smart contracts are now commonly known in integration with Ethereum.

But to prosper beyond the decentralized apps (dApps) development, the Ethereum blockchain has to integrate the data into smart contracts connecting through external on chain and off chain domains. The capacity of the smart contracts is being increased by the oracles now.

Chainlink protocol is one of the oracles that are based on consensus. It provides an extra security to the complete blockchain environment where it is operated. It does so by decentralizing it end to end that in return acts as the key factor for ensuring safety. These protocols also offer high transparency to the systems operating on-chain by increasing the functions performed by the smart contracts through the oracles.

This results in achieving higher security buy infusing the special properties of the blockchain with the distinct qualities of smart contracts. This creates a hybrid smart contract that possesses more capabilities and capacity than the normal on chain protocol.

What is Meant by Chainlink VRF?

For the provision of advanced functions such as functioning a lucky draw or showing up an airdrop or creating the games that are based on chances, the decentralized apps and many nonfungible tokens require a secured and verified sources that could generate random numbers.

The Verified Random Function (VRF) associated with the Chainlink is dependent on the Decentralized Oracle Network that provides the substantial data off-chain that could further assist in enhancing the already existing blockchains. This helps in export of the data present on the blockchain to the systems that are far beyond the access of the blockchain network.

A complete range of Chainlink nodes is employed that facilitates to relay the data to the smart contracts, thus making it possible for the Chainlink VRF to ensure secured randomness cryptographically. While carrying out the procedure, the complete set of these nodes is kept intact with the classical consensus mechanism.

Chainlink VRF also assists the developers in creating better portfolios for smart contracts by providing them the opportunity of Random Number Generation (RNG). For this purpose, it provides them high leveraged outcomes in the applications that are powered by the blockchain technology.

Moreover, the security is ensured as the randomness that is provided by the Chainlink is tamper-proof. No external entity whether a node operator, any user or any outsider can interfere with it or manipulate it. The reason to this restriction is as the in the decentralized oracle network, every oracle is assigned with a pair of private and public keys. The public key is published in the on-chain network while the private key is kept intact off-chain.

What are the Possibilities of Attacks with Randomness Approach?

Every transaction is checked upon by every node in the Ethereum ecosystem where they try to solve the problem. After the verification of the issue by all the nodes, it is broadcasted further to the network.

For example, if a decentralized app is developed where the head wins when a coin is being flipped. The function will then be used to predict the number of heads and tails. One can carry out the transactions only to the node if he wishes to run a node, but it cannot be then shared further. For this purpose, one can flip the coin after sharing and winning the transaction or can also operate the randMod function.

This problem can be sorted out by getting the access to a random number generation. This number generation is not to be a part of the Ethereum ecosystem. The way out is going through the functions and cryptographic algorithms drafted by the third party. These functions still need to be audited as they are not considered safe.

Working of Chainlink VRF

Chainlink VRF is used by a smart contract to get a verified and safer random number as an outcome. This process is carried out in four steps

• Step 1

On the Ethereum mainnet or testnet such as Ropstan, Rinkeby and Kovan, create a subscription and add funds to it.

• Step 2

Then on the testnet, build and install a smart contract that is compatible with the Chainlink VRF. You can also do that directly on the Ethereum mainnet.

• Step 3

After that use the smart contracts to request for random values. This is done by using the output from the oracle that was kept as an array in the smart contract.

• Step 4

The random number generated can be verified by the authentication process. For this purpose, one has to utilize the private key and the public key that is issued in integration to the smart contract.

Chainlink provides a safer and more secured decentralized way of storing the keys that are capable of handling the generalized computations. As to generate any random yet unpredictable value, the Chainlink VRF uses two keys a private and a public key. The number generated can be then verified through proof of correctness mechanism.

Random number generation mechanisms are usually unsafe and there are always risks associated with it as it depends on computing process carried out off-chain. However, the problem is solved by the Chainlink VRF’s cryptographic verification that is carried out on-chain.

This verification process integrates the on-chain data available that further acts as input to provide the tamper proof and transparent output. In case if they are produced through any problematic oracles present in the same network, these results are still considered safer.

Chainlink VRF has its usage in the decentralized finance (DeFi) protocol by using the smart contracts that are reliable and trustworthy. Due to the extra ordinary capabilities, it is used in the Decentralized Finance such as Moonbeam for providing the Polkadot (DOT) developers with the real time data and in PoolTogether where it helps the users to collect a fair amount of gamified savings.

Chainlink VRF is also being used for the proper distribution of the nonfungible tokens fairly. This is helpful in the introduction of entropy by offering the verified randomness solution in gaming carried out on-chain such as in Axie Infinity (AXS) and also in case of Polychain Monsters.

Chainlink VRF is growing as a subdivision of Chainlink 2.0 mechanism, therefore it contains all the required resources for  computation and the architecture that is needed to make the smart contracts capable of providing the advanced functions and properties. In integration with the other decentralized oracle networks (DONs), Chainlink VRF is also helping in the creation of a profile that could be easily entrusted by the developers all around the world.

Chainlink VRF Mechanism

Chainlink VRF are operated by integrating with the smart contracts. The Chainlink VRF mechanism is explained in the points explained below.

• After the installation of the smart contracts, a hint for the generation of a random number is given to the Chainlink Oracle.
• The oracle does not predict the hint provided. It is then used for the creation of a random number. The private key is used by every oracle to generate a random number.
• After the on-chain publication of the results and the proofs, authentication can be carried out by the public key of the oracle and the hint provided by the smart contract initially.
• The advantage of the popular verification qualities of the blockchain ecosystem can be leveraged by this procedure then.
• The random numbers that are already checked and authenticated in a same blockchain platform can also be used by the smart contracts.
• Checking and authenticating the random numbers is one of the biggest benefits of integrating Chainlink VRF with smart contracts.
• The final result cannot be exploited or manipulated by anyone even if the node is attacked by an external body. This is because it cannot go through the encryption process on the chain.
• In case of worst scenario, it can happen that the request is not responded back by the down nodes. The blockchain will instantly record this process and the blockchain will keep it forever on it.
• Some validity tests can be carried out by the users, and they can stop using the nodes if they do not respond back or do not provide any valid signature records to them.
• The random number that is generated will not be affected even if the node is being operated. The requests can be ignored by the busy nodes on purpose.
• However, this problem will be charged a penalty in the next Chainlink delivery mechanism. This will result in the removal of the problem node from the network. Therefore, the problematic nodes that are unable to provide the services can go through enormous long-term or short-term economic losses.
• The Chainlink VRF can never be interfered by anyone as long as it is connected in a proper manner. The only problem that can be faced is the non-responding or offline problem node. It is then completely eliminated from the network.
• It is a highly secured and tamper-proof mechanism for the developers and the users.

Why Should Chainlink VRF be Used?

Chainlink VRF owns some distinct features that make it important and essential for the blockchain network. Some of them are mentioned below.

• The process of Random Number Generation (RNG) for the smart contracts is regulated by Chainlink VRF.
• The randomness produced for the game outcome by the Chainlink VRF is unbiased and untampered.
• Smart contracts can be used to get all results of random numbers after completing the verification process.
• The results that are generated cannot be manipulated by the oracles under the regulation of Chainlink VRF.
• Chainlink VRF creates a trust level among its users by providing them the integrity of the game. It also provides the cryptographic proof along with it.
• No external entity such as node operators or malicious users can manipulate the results of randomness under the regulation of Chainlink VRF.

Technical Specifications of Chainlink VRF

As the name signifies, Chainlink Verifiable Random Function (VRF) does not allow any external entity to predict the key or hint at any cost. The principle of uniform probability distribution applies here. Some of the technical specifications of Chainlink VRF as mentioned below.

• The oracle machine encrypts the key that is owned by VRF.
• The oracle also possesses a public key in correspondence to the private key.
• The public key is then integrated with the VRF key and the ID of the Chainlink that is located on-chain by the oracle.
• A seed is produced during the process when the smart contract is making a request for the random number.
• With the seed, there are stored difficult and totally unpredictable values. This is done to make sure that nobody could guess the results of the VRF.
• The chain data or the hash value is encrypted and verified.
• To provide extra protection and security to the contracts and to avoid it from external attacks, the Chainlink VRF mixes some different data components with the smart contract seed.
• Once when the seed is determined by the VRF that is present on the chain, then this process will be continued by them to request the corresponding VRF results. By broadcasting in the Ethereum ecosystem, these results are required by an oracle on the smart contract.

Explaining Chainlink VRF v2

In order to improve and upgrade its characteristics that are offered through the Decentralized Oracle Networks (DONs), Chainlink VRF has introduced its upgraded advanced version known as Chainlink VRF v2. It contains a number of improved features and attributes to facilitate the users. It enables the users to easily ask for the smart contracts and fund them.

Benefits of Chainlink VRF v2

Some of the updated and advanced features of Chainlink VRF v2 are mentioned below

• The advanced features of the Chainlink VRF v2 enables the users that they could generate a number of random outputs while carrying out one transaction on chain. This will result in the reduction of the time consumed in carrying out a single transaction and also the charges required such as gas fee and or the transaction fee.
• It also provides the access to multiple developers and the users to access for the request of verifiable randomness at the same time. Multiple number of addresses of smart contract, that can be up to 100 can try to ask for it by using a subscription through a single link that is actually owned by the owner or developer.
• Similarly, it enables the developers to fund the application before hand by using a token via a single link. It does so by the Subscription Manager application that it has introduced to the users. This helps in a considerable reduction in the Chainlink VRF fee.
• The limits of gas are dependent on the blockchain being used underneath, it is normally higher than the predicted values. The gas cost and charges are mentioned and explained explicitly on the contract address pages of Chainlink VRF.
• The larger customization capability is another advantage of Chainlink VRF v2. It helps the developers to predict that to generate a random number and to get it delivered on the blockchain, how many block confirmations will be needed.
• The developer can choose a number of blocks between 3 to 200 and then set a maximum value of the blocks to be generated. This all process is carried out before the generation of randomness. It helps in the protection of applications from reorganizing the blocks and also providing a minimum time gap between the request generation to the result production process.
• Chainlink VRF v2 also helps the developers to access on-chain randomness that has high efficiency in gas and is extremely scalable. Moreover, it can also help the users to achieve greater efficiency for the NFTs and the gaming dApps.

What is the Future of Chainlink VRF?

The advanced improvements and updated features of the Chainlink VFR have made it a priority for the developers that are planning to build the decentralized apps over Ethereum blockchain. It is creating the opportunities to build a number of secured applications that are based on blockchain. It has enabled the developers in the creation of relatively practical utilities that are capable of reliably integrating with the real-world data.

Chainlink VRF provides a greater opportunity to the users taking the blockchain ecosystem a step farther. As blockchain can easily be connected to the external domains in a secured manner, it has provided the chance to the developers to connect to the edge of Metaverse.

Conclusion

As the demand of deploying the smart contracts in the blockchain is increasing with time, the integration of Chainlink VRF with it has created a number of good opportunities for the developers and the users all around the world. It is providing the users the opportunity to generate the random numbers in a more secured way now.