Triggers can be set up on a blockchain, which group various transactions together to be executed when the designated conditions are met.
What Are Transaction Triggers?
Blockchains are made up of a series of individual blocks of data, and can be thought of as a decentralized distributed ledger. Each block contains information about transactions conducted within a given time period, and also has a unique identifier (known as a hash) to differentiate them from other blocks in the chain.
Transactions executed on-chain are considered valid only when the blockchain has been updated to reflect them on the public ledger. They must be validated by a number of the network’s participants, who are called miners or validators, depending on the chain. This offers security and transparency as no one is able to change the data once the block has been verified and recorded on the network.
Thus, triggers can be set up, which group various transactions together to be executed when the designated conditions are met.
This can provide added convenience and assurance for users in various ways. For example, a stop loss order can be set to trigger on decentralized platforms by users when the price of the assets they have borrowed plunges to a certain threshold, to close their positions to mitigate losses and manage risk.
As cryptocurrencies are volatile assets and prices can fluctuate too quickly for users to react, this can prove to be essential especially during bear markets or negative market conditions, and eliminate the need for constant monitoring, which can be impractical and time consuming.
In bull markets or healthy market conditions, the reverse is also true, as users can set automated transactions to trigger. One such example would be in the form of limit orders on decentralized exchanges to take profits when the cryptocurrencies increase to desired price levels.
Author: Marco De Rossi, President & Cofounder
Marco De Rossi is the President and co-founder at HAL, who envisions a future tech landscape where companies or developers can choose to integrate decentralized technologies depending on whether or not they need to be trustless. Marco is an experienced speaker with a background in economics and arts. He holds a wealth of experience in the tech space as a programmer, a digital marketing consultant and as a journalist. He is also the founder of WeSchool, a leading EdTech company with 2M+ users.
HAL is a Web3 data infrastructure tool, allowing developers, protocols and companies to track, monitor and trigger data via simple APIs and push notifications. Their mission is to democratize and simplify access to blockchain infrastructure, bridging decentralized and centralized technologies.
