Data Provider API3 and Open Banking Platform have entered into a 10-year partnership to connect banks to the blockchain via API and leverage banking data in DeFi and Web 3.0.
API3 co-founder Heikki Vanttinen said API3 and Open Banking have entered into a 10-year agreement. This partnership will bring together the “disparate” worlds of centralized and decentralized finance (DeFi). Vanttinen explained that banks will be able to work with Web 3.0 developers to explore options for using open banking data for DeFi. Based on Open Banking data, developers will be able to create various blockchain-based solutions, for example, systems for data verification and identity identification.
Simon Redfern, CEO of the Open Bank Project platform, believes that this will lay the foundation for the creation of new standards, as well as create conditions for the introduction of blockchain into banking operations. The Open Banking service is increasingly used by banks around the world, allowing authorized third-party providers to access their data through an API. The Open Banking project works with governments to develop industry standards for leading financial institutions and banks, including Santander and HSBC.
The API3 data provider uses a technology called Airnode. It is open source software that transfers information directly from third party data providers. This data is then collected on the blockchain. Therefore, information providers, stock exchanges, and credit reporting agencies can run applications on the same cloud hosting platforms where their APIs are hosted. This will reduce the number of intermediaries and reduce costs.
Vanttinen said Airnode would be suitable for connecting bank APIs to Web3 applications, since the service is managed by the API provider itself, not a third-party intermediary. Code is generated and maintained by a decentralized autonomous organization (DAO) where stakeholders can collaboratively create and manage decentralized application programming interfaces (dAPIs) without a central governing body.
The partnership with Open Banking will enable API3 to enter the institutional marketplace where data oracles are used. However, API3 has a serious competitor – Chainlink, which is currently integrated with more than 400 projects. A few days ago, Chainlink developers reported that they are creating new off-grid decentralized oracles that can provide solutions for scaling supported networks. Another data oracle provider, Band Protocol, announced the integration with Google, and last August, Band Protocol oracles were integrated into the Binance Smart Chain blockchain.
