Pricing oracles
To ensure the integrity of UPFI peg, the UPFI protocol gathers necessary data, such as market price and liquidity pool information. UPFI network currently makes use of Chainlink & Pyth Oracles. The integrity of the system relies on an accurate price of UPFI and UPS. To achieve this the U.S. Dollar price of USDC is retrieved from Chainlink, UPS/USD from Pyth network. This gives the protocol a consistent and up to date reading of the USD price of UPFI, UPS tokens, used in calculating the Target Collateral Ratio(TCR).
We’re excited to announce that UPFI Network is integrating the industry-leading Chainlink Price Feeds on Solana as its oracle solution to help maintain the peg of its partially collateralized and partially algorithmically stabilized stablecoin called UPFI. The initial integration involves the use of the Chainlink USDC/USD Price Feed, which is referenced during all mints and redemptions.
We selected Chainlink because it’s the most time-tested decentralized oracle network in the industry, with Chainlink Price Feeds already helping secure tens of billions of dollars in value across DeFi. Not only do Chainlink Price Feeds support high-quality data with robust uptime and manipulation-resistant infrastructure, but they provide the custom update frequencies required to maintain our unique stablecoin design on Solana.
For our smart contracts to accurately calculate in real-time the price of collateral during minting and redemptions, we needed an oracle solution that can fetch highly precise USDC/USD exchange rates and deliver them on-chain securely and reliably. This price oracle is critical to maintaining both the peg and protocol solvency.
Chainlink Price Feeds are open-source, decentralized data feeds that have been battle-hardened in production and already used by many of the leading applications in the decentralized finance ecosystem. By integrating Chainlink Price Feeds, the calculation of collateral during minting and redemption becomes more secure and tamper-proof while still maintaining frequent response times and high accuracy.
Some of the most notable considerations around Chainlink Price Feeds that make it ideal over other alternatives include:
● High-Quality Data — Chainlink Price Feeds source data from numerous premium data aggregators, leading to price data that’s aggregated from hundreds of exchanges, weighted by volume, and cleaned from outliers and suspicious volumes. Chainlink’s data aggregation model generates accurate global market prices that are resistant to API/exchange downtime, flash crash outliers, and data manipulation attacks.
● Low Deviation Updates — Chainlink Price Feeds running on Solana can perform low deviation price updates at minimal costs, resulting in precise price data that consistently reflects current market conditions.
● Robust Infrastructure — Chainlink Price Feeds utilize decentralized networks of professional node operators run by leading blockchain DevOps teams and traditional enterprises with a strong track record of uptime during market volatility.
● Transparent Monitoring — Chainlink provides a robust reputation framework and set of on-chain monitoring tools that allow users to independently verify the historical and real-time performance of price feeds.
Smarter data for smarter contracts.
Pyth is designed to bring real-world data on-chain on a sub-second timescale. The initial integration involves the use of the Chainlink UPS/USD Price Feed, which is referenced during all mints and redemptions.
DIA (Decentralised Information Asset) is an open-source, data and oracle platform for the DeFi ecosystem. DIA leverages crypto-economic incentives to drive supply, share and use transparent, crowd-verified price data and oracles on financial and digital assets.
Last modified 1yr ago