Telefonica Partners with Chainlink for Enhanced Security

Telefonica, a Spain-based telecommunications company, has secured a strategic partnership with the decentralized oracle network Chainlink (LINK). According to an official announcement on Feb. 15, the collaboration aims to integrate real-world telecommunications capabilities into blockchain networks to improve Web3 applications and smart contracts security.

A primary goal is to address fraudulent activities, particularly SIM Swap attacks. In these attacks, cybercriminals trick a cellular service provider into transferring a victim’s service to a SIM card under their control. 

To combat SIM swapping, Telefonica and Chainlink plan to utilize the SIM SWAP API introduced by the GSMA Open Gateway.” This mobile network provides Application Programmable Interfaces (APIs) for businesses and developers to address various challenges within the Web3 space, including secure account creation and fraud prevention. Telefonica is a member of GSMA.

The SIM SWAP API checks when a SIM card linked to a mobile number was last changed, helping prevent fraud in personal and banking accounts. Moreover, via Chainlink Functions, a web3 platform for retrieving data from real-world APIs, the SIM SWAP API will enable developers to verify data from various sources. 

Integrating SIM SWAP API and Chainlink’s platform will provide “an extra layer of security” to blockchain transactions.” Telefonica said it will help ensure that there have been no unauthorized changes to a SIM card. Moreover, they intend to introduce the SIM SWAP API in Brazil through its subsidiary, Vivo.

Johann Eid, Chainlink Labs’ Chief Business Officer, said:

“Bringing Telefonica’s OpenGateway APIs onchain with Chainlink Functions unlocks novel use cases and greater security for our industry that ultimately better protect users and their assets.”

Increase in SIM Swapping Attacks

The Web3 sector has experienced a growing incidence of SIM swapping attacks. One notable incident occurred in 2022 when $400 million was fraudulently taken from Sam Bankman-Fried’s FTX exchange during its collapse. 

A SIM swap attack recently targeted Gary Gensler, the Chair of the US Securities and Exchange Commission (SEC). The incident resulted in a fake post on X, falsely claiming that the SEC had approved Spot Bitcoin ETFs.

The latest collaboration between Telefonica Chainlink marks a significant step in fortifying the security of Web3 applications, ultimately contributing to the resilience and verifiability of the digital landscape.