Posted onNovember 13, 2022
Silo Finance Integrates Chainlink Price Feeds for a Smooth & Seamless Operation of Lending Markets
Chainlink Price Feeds have been integrated by Silo Finance onto the Ethereum mainnet. Silo Finance now has access to advanced, tamper-proof price feeds that are necessary to assist in ensuring that proper financial activities are carried out as a result of integrating the industry-leading decentralized oracle network.
In particular, this integration serves to convince customers that Silo Finance lending markets will continue to operate effectively and without interruptions, even in the midst of volatile market conditions. The initial phase of Silo Finance’s integration utilizes 8 Chainlink Price Feeds, with an additional 38 to follow in the near future. Chainlink was selected as the primary Oracle solution due to the ease with which its infrastructure could be integrated and the fact that it had been tried and tested in production.
Chainlink is already helping to protect leading DeFi protocols, which are responsible for tens of billions of dollars in smart contract value. Chainlink is capable of maintaining reliable security and high availability even in the midst of unforeseen circumstances, such as exchange downtime, flash crashes, and data manipulation threats via flash loans.
Creating Lending Markets For All Digital Assets
Silo Finance is a decentralized, non-custodial lending protocol that enables risk-isolated lending markets. It was launched in August 2022 on Ethereum. The conventional approach of lending from a shared pool is turned on its head by Silo Finance, which creates one lending pool for each token asset and connects all of the pools using protocol-wide Bridge Assets.
As a consequence of this, any token asset can be used as collateral to borrow another, which paves the way for the creation of borrow/lend markets for all assets in which the risk is isolated to a single market at a time. Silo Finance is a risk-isolating lending protocol that aims to build lending markets for all digital assets without compromising on the level of security offered.
In order to accomplish this, each market, also known as a “silo,” consists of only three assets: a base asset, such as CRV, and two bridge assets, consisting of ETH and the native stablecoin of the protocol, XAI. Depositors in one market have the ability to borrow from depositors in another market using bridge assets, but they are still only exposed to the risk of one token asset.
Due to this innovative method, Silo Finance is now positioned to become the hub for all kinds of tokens, including blue chips, yield-bearing tokens, and synths. In order to assist in the protection of their risk-isolated loan markets, they required access to recently updated asset prices that are provided immediately on-chain in a manner that is very dependable.
Prices of assets on the fair market need to reflect a volume-weighted average of prices fetched in all trading contexts. As a result, Silo Finance was required to make use of an oracle network in order to retrieve aggregated price data from off-chain sources and then transport it on-chain so that our application could use it.
Aiham Jaabari, founding contributor of Silo Finance, said: “Integrating Chainlink Price Feeds was integral to realizing our vision of secure lending markets that support all token assets. As Silo Finance’s primary digital asset price provider, we look forward to expanding our use of Chainlink Price Feeds as our protocol supports more markets and chains.”
Chainlink Price Feeds’ Wide Range Of Features
After looking at a number of other Oracle solutions, Silo Finance decided to connect Chainlink Price Feeds because they offer a wide range of important capabilities. For instance, Chainlink Price Feeds obtain their data from a wide variety of premium data aggregators, which results in price data that is compiled from a large number of exchanges, weighted by volume, and free of outliers and wash trading.
The data aggregation technique utilized by Chainlink results in the generation of more accurate global market prices that are inherently resistant to the inaccuracies or manipulation of any one exchange or small collection of exchanges. In addition, Chainlink Price Feeds are protected by oracle nodes that are independent, have their security assessed, and are resistant to Sybil attacks.
These nodes are operated by renowned blockchain DevOps teams, data providers, and traditional businesses. Even in the face of fluctuating gas prices and failing infrastructure, the reliability of Chainlink nodes has been proven to be exceptionally high. Chainlink Price Feeds are also decentralized at the data source, oracle node, and oracle network levels.
This creates robust defenses against outages and tampering on the part of either the data provider or the oracle network. In addition, Chainlink offers customers a dependable reputation structure in addition to a collection of on-chain monitoring tools. These features make it possible for users to independently check the past and current performance of node operators and oracle networks.
Chainlink is an industry-standard Web3 services platform that has facilitated huge amounts of money in transaction volume across DeFi, insurance, gaming, NFTs, and other significant industries. Chainlink, the leading decentralized oracle network, allows developers to develop feature-rich Web3 applications with cohesive access to real-world data and off-chain computation across any blockchain. It also provides global enterprises with a universal gateway to all blockchains.