DefiDollar Using Chainlink Price Oracles on Mainnet
Price feeds help to rebalance the asset pool ensuring stability of DUSD
We are excited to announce that DefiDollar has successfully integrated Chainlink’s widely used Price Reference Data oracle networks live on mainnet to push periodic price updates to our smart contracts. If the prices show that underlying stablecoin assets have slipped from their $1 peg, then the protocol calls into action the staked reserve to guarantee the outstanding DUSD and bring DefiDollar back to the $1 mark again. This brings strong, automated guarantees to the users that $DUSD maintains its peg even during volatile market conditions.
We chose Chainlink’s Price Reference Data over other solutions because it:
- Provides accurate, fresh price feeds sourced from high-quality off-chain data aggregators that account for volume and volume shifts across the market
- Maintains strong security and reliability guarantees of data delivery using decentralized oracle networks made up of independent, Sybil resistant node operators
- Is a proven oracle framework that currently secures over $3B in value for DeFi, and is actively funded by numerous other top DeFi projects like Synthetix, Aave, and yEarn
Deeper Look into the Integration
For those new to the protocol, DefiDollar (DUSD) is a stablecoin collateralized by a basket of other stablecoins (currently sUSD, USDT, USDC, and DAI) that uses DeFi primitives to stay close to the dollar mark. DUSD provides an avenue for diversifying your stablecoin holdings to hedge against an event where the underlying stablecoins deviate from their peg. The underlying assets backing DUSD are collateralized by Curve Finance LP tokens, allowing them to earn trading fees that get fed in our earnings pool as interest revenue for holders, as well as helping to support re-collateralization scenarios.
As part of the integration, we will be leveraging Chainlink’s sUSD/ETH, USDT/ETH, DAI/ETH, USDC/ETH, and ETH/USD Price Reference Data feeds, all of which are already live on mainnet and collectively supported by numerous other projects. We will use ETH/USD as a reference price from which to compare all the other pairs against to calculate the peg of each stablecoin. If the peg is found to be below a dollar, our smart contract automatically triggers a rebalancing of the asset pool, ensuring stability of DUSD.
Each price feed oracle has on-chain visualizations available to users, allowing them to independently monitor in real-time the health of each stablecoins and the ETH/USD price (pictured above). This brings heightened transparency to our protocol, as all rebalancing actions for DUSD can be easily verified on-chain.
DeFi Dollar Co-founder Arpit Agarwal commented on the Chainlink integration, stating “Stable value is critical to the success of DeFi and its ability to support a larger market of users. We are excited to integrate Chainlink’s secure and reliable price oracles to ensure that DUSD is always fully collateralized and this process takes place automatically without human intervention.”
DefiDollar is a meta stablecoin index backed by multiple DeFi protocol’s LP tokens. It aims to provide the easiest way for users to store value in stable digital assets while accruing returns from various DeFi Protocols
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DefiDollar - App
DUSD is a metastable asset that provides a hedge against volatility.
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Chainlink is a general-purpose framework for building and running decentralized oracle networks that give your smart contract access to secure and reliable data inputs and outputs.
If you’re a developer and want to quickly get your application connected to Chainlink Price Reference Data, visit the developer documentation and join the technical discussion in Discord. To schedule a call to discuss the integration more in-depth, reach out here.
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