Case Study RedStone
RedStone: Transforming DeFi with Innovative Oracle Solutions
RedStone is a cutting-edge Oracle platform redefining data feeds for decentralized applications (dApps) and smart contracts across various Layer 1 and Layer 2 blockchains.
Why RedStone?
- Efficiency: Eliminates on-chain data waste.
- Scalability: Modern architecture for agility.
- Trust: Empowers users to control data sources.
- Independence: Reduces reliance on third-party relayers.
Our Solution
- Data providers no longer require continuous on-chain data delivery.
- Users can independently submit signed Oracle data on-chain.
- Secure data transmission via the decentralized Streamr network.
- Token incentives ensure data integrity and uninterrupted service.
- Leverages Arweave for cost-effective, permanent data storage and accountability.
Key Highlights
- Modular architecture guarantees data integrity.
- Three flexible integration options.
- Over 1000 assets supported from 50+ data sources.
- Active on 20+ blockchain networks.
- Serving DeltaPrime since March 2022, live on mainnets since January 2023.
- Rigorously audited code by security experts, including ABDK, Peckshield, and L2Beat Co-Founder.
RedStone: Bridging DeFi and dependable, efficient data feeds.
Time goes by and we find new partnerships and integrations, but why is this happening?
On a practical example, we will analyze some projects.
Swell and RedStone: Pioneering Liquid Staking and Oracle Solutions in DeFi
In the rapidly evolving world of decentralized finance (DeFi), innovation is the key to staying ahead of the curve. Swell, a decentralized liquid staking protocol, is making waves by offering a top-tier liquid staking experience, streamlining DeFi access, and contributing to the future of Ethereum. At the heart of Swell’s success is its unique approach to liquid staking, embodied by the swETH token. In this article, we delve into what Swell is, the mechanics of swETH, and the challenges it faced in the DeFi space.
Swell and Liquid Staking:
Swell’s mission revolves around empowering users to generate passive income by staking their ETH. The process involves staking ETH to the Swell swETH contract, which mints an equivalent amount of swETH tokens to the user. But Swell’s innovation doesn’t stop there. It goes a step further by pooling staked ETH until a minimum of 32 ETH is accumulated. At this point, the next validator in the registry contract is selected, and a deposit is made into the Ethereum deposit contract, initiating the validator’s journey towards consensus layer activation.
swETH Mechanics:
It’s essential to understand that swETH is not a rebasing token. Instead, it’s a reward-bearing token. This means that its value increases over time, reflecting the accumulated staking yield. This approach avoids creating potentially taxable transactions, offering a more seamless experience for users.
Challenges Faced by Swell:
Swell’s success story is not without its challenges, particularly in the context of the oracle offerings in the DeFi market. The obstacles include:
(a) Limited Reliable Options: Swell encountered limited reliable oracle options in the market, a critical component for DeFi protocols seeking to broaden their utility.
(b) Liquidity Requirements: Establishing robust and deep liquidity on swETH was another challenge, as liquidity is essential for DeFi assets to thrive.
© Lack of Universal Standards: The lack of universal standards and information regarding oracle requirements for Liquid Staking Tokens (LSTs) across the ecosystem posed a significant hurdle.
The RedStone Solution:
In collaboration with the RedStone team, Swell embarked on a journey to address these challenges. The implemented solution included:
-Price Discovery Mechanism: RedStone implemented a price discovery mechanism based on the three most liquid decentralized exchanges (DEXes) where swETH tokens were deployed, ensuring accurate pricing information.
-Liquidity Monitoring: A liquidity monitoring service was put in place to react to changes in the deployed tokens’ amount, mitigating attempts to manipulate the price.
-Data Provider Nodes: Multiple data provider nodes, relayer nodes, and monitoring services were deployed to actively track the operations of data-providing infrastructure.
The Future of Swell x RedStone Partnership:
Looking ahead, Swell and RedStone aim to actively promote the use of the price feed, a critical tool for traders, analysts, and developers in DeFi. This partnership seeks to integrate other projects into the SWELL platform, offering them access to precise and current market data. By doing so, they aim to enhance efficiency, decision-making, and innovation across various DeFi markets.
Exclusive Interview with Swell Team:
In an exclusive interview with Daniel Dizon, Swell Labs CEO & Founder, he shed light on their oracle challenges and why they chose RedStone as their solution. According to Dizon, RedStone’s technology and efficient data retrieval methods were pivotal in enhancing Swell’s utility and composability in DeFi.
In conclusion, Swell and RedStone are emblematic of the innovative spirit within the DeFi space. Their collaboration not only addresses critical challenges but also paves the way for broader adoption of liquid staking and oracle solutions, ultimately driving the evolution of decentralized finance.
DeltaPrime and RedStone Oracles: Pioneering Trustless DeFi Loans with Real-Time Data Feeds
In the fast-paced world of decentralized finance (DeFi), staying ahead means adapting to market trends and continually enhancing protocols. DeltaPrime, the first Avalanche-native protocol offering undercollateralized DeFi loans, recognized the importance of an ongoing partnership with its Oracle provider, RedStone Oracles. In this article, we explore the results of their integration and how they are shaping the future of DeFi.
DeltaPrime: Trustless DeFi Loans on Avalanche:
DeltaPrime is a groundbreaking DeFi protocol that allows users to borrow more capital than they deposit as collateral, all while ensuring the safety of depositors’ funds through liquidation bots. With a minimum collateral ratio of just 20%, users can amplify the potential returns of their DeFi investments by up to 5x. This unique approach has made DeltaPrime a standout player in the Avalanche ecosystem.
DeltaPrime’s Oracle Challenge:
At the core of DeltaPrime’s business model lies a sophisticated evaluation of borrowers’ portfolios, encompassing various assets, including basic ERC20 tokens like ETH and more complex positions in liquidity-providing (AMM), vaults, and farms. This meticulous monitoring allows DeltaPrime to precisely value each portfolio, ensuring financial stability and trust. However, traditional “push” oracle models, with their limited token set and lack of coverage for derivative assets like LP positions, fell short of DeltaPrime’s requirements.
RedStone’s Innovative Solution:
RedStone offered DeltaPrime an innovative solution with several advantages:
-Real-Time Tracking: The Core Model guarantees a latency of around 10 seconds, providing almost real-time tracking of deposited collateral values. This enables users to create more risk-seeking strategies.
-Broad Token Coverage: RedStone delivers price data for approximately 40 tokens, including LP and staked tokens, which were previously unavailable from other Oracle services. This broad coverage allows DeltaPrime users to explore unique combinations of positions and potentially earn higher yields on less popular and liquid assets.
-Affordability: Gas fees are only collected when the data is used to process a transaction on-chain, making it an affordable solution for DeltaPrime.
Implementation of the Solution:
The RedStone team worked closely with DeltaPrime to implement the Core Model. This effort involved custom development to provide real-time prices for a diverse set of assets, including LP and staked tokens. RedStone’s flexible fetchers architecture allowed for the swift addition of new price feeds. Both teams also conducted risk research to determine liquidity thresholds for asset tracking and devised methodologies to detect price manipulation based on historical volatility.
The Future of DeltaPrime-RedStone Partnership:
DeltaPrime envisions its Prime Account becoming the primary platform for users to manage their blue-chip investments. This ambitious goal requires accurate and reliable pricing data, extending to Real World Assets (RWAs) in the future. The collaboration between DeltaPrime’s ambition and RedStone’s innovative solutions is poised to solidify DeltaPrime’s position in the market, giving users unprecedented control and flexibility over their investment decisions.
Exclusive Interview with DeltaPrime Team:
Piotr Duda, DeltaPrime Founder & CEO, shed light on their choice of RedStone and the integration process:
-Why RedStone? RedStone was chosen for its ability to provide secure data feeds of derivative tokens on the Avalanche C-Chain, making it a unique solution. Additionally, its compatibility with various EVM Layer 1 and Layer 2 networks promises easier cross-chain expansion.
-Integration Process: The integration process began with DeltaPrime developers experimenting with RedStone’s provided examples. They made necessary updates to smart contracts and the UI to align with the innovative Core model. RedStone’s continuous support and guidance ensured the highest safety standards for DeltaPrime’s system.
-Ease of Integration: Despite the unique nature of RedStone’s model, the integration was relatively straightforward, thanks to comprehensive documentation and tutorials. RedStone’s team provided valuable assistance throughout the process.
In conclusion, the DeltaPrime-RedStone partnership exemplifies the ongoing collaboration required to thrive in the DeFi space. By leveraging RedStone’s real-time data feeds and innovative solutions, DeltaPrime is poised to offer users a revolutionary DeFi lending experience while maintaining financial stability and trust.
Vesta Finance and RedStone Oracles: Pioneering Decentralization in Stablecoin Protocols
In the world of decentralized finance (DeFi), collaboration and innovation are key drivers of success. Vesta Finance, a layer 2-first stablecoin protocol, recognized the need for a secure and decentralized oracle solution to enhance its ecosystem. This led to a strategic partnership with RedStone Oracles, an innovative oracle provider. In this article, we explore the results of their integration and how it strengthens Vesta Finance’s position as a prominent stablecoin protocol.
Vesta Finance: A Layer 2-First Stablecoin Protocol:
Vesta Finance operates as a layer 2-first stablecoin protocol, enabling users to maximize liquidity against their collateral. Users can secure their collateral and generate Vesta’s stablecoin, VST, which maintains a value of 1 VST = $1 USD. The system ensures over-collateralization, with the dollar value of locked Ether exceeding the value of issued stablecoins. VST generation is controlled algorithmically through a variable interest fee.
Vesta’s Oracle Needs:
Vesta Finance’s commitment to decentralization led them to seek a more decentralized oracle infrastructure. They were concerned about the centralization of their previous oracle solution and its potential impact on their protocol’s security and reliability. RedStone’s customizable and secure oracle solution aligned with Vesta Finance’s values and addressed their concerns.
The Proactive Approach:
Vesta Finance faced limitations in onboarding additional partnerships due to concerns about the centralization of their existing oracle. In response, they proactively sought an oracle integration with RedStone. This strategic decision allowed Vesta Finance to alleviate potential partner concerns and create an ecosystem conducive to collaboration.
Implemented Solution:
RedStone’s integration with Vesta Finance involved several key steps:
-Liquidity Analysis: RedStone analyzed on-chain liquidity to identify the best sources for price discovery.
-Short-Term Medianized TWAP Fetcher: RedStone implemented a short-term medianized TWAP (Time-Weighted Average Price) fetcher connected to the Curve pool, reducing price manipulation risks.
-Multi-Node Infrastructure: RedStone deployed a distributed multi-node infrastructure, comprising data provider nodes, relayer nodes, and monitoring services.
As a result, RedStone provides a continuous feed for the VST token price updated at a 0.2% deviation threshold. This data is accessible on-chain and can be consumed by standard interfaces used by most blockchain protocols.
Vesta Finance Team on RedStone:
Mikey M, Co-Founder of Vesta Finance, shared insights on their choice of RedStone and the integration process:
-Why RedStone? Vesta Finance chose RedStone due to its transparency, quick communication, and the custom-fit solution it offered. RedStone’s ability to tailor their services to Vesta Finance’s needs made them stand out.
-Integration Process: The integration process was described as great, with RedStone offering various types of services and explaining each one’s functionality to ensure the best fit for Vesta Finance’s token.
In conclusion, the partnership between Vesta Finance and RedStone Oracles exemplifies the collaborative spirit within the DeFi space. By prioritizing decentralization and leveraging RedStone’s innovative solutions, Vesta Finance is enhancing the security and reliability of its protocol while fostering a decentralized future in stablecoin protocols.
