Venus Upgrades to Chainlink
Venus has now fully upgraded to Chainlink as its oracle solution.
As the most widely used and time-tested decentralized oracle network, Chainlink provides the much needed security, reliability, and data quality needed to scale our fast growing ecosystem, which already has over $3.5 Billion in total value locked (TVL) shortly after launch. Importantly, Chainlink is already running directly on BSC, making the integration quick and straightforward. Additionally, it allows us to leverage Chainlink oracle networks at the native speeds of BSC, resulting in more timely price updates in a cost efficient manner.
In order to have a fully algorithmic money market, Venus requires price data to determine the value of the underlying collateral lent and borrowed by users. This price data is needed in two important processes, loan issuance and loan liquidations. Every time a user requests a loan, Venus needs the fair market value of the underlying collateral to determine the loan size. Additionally, Venus protocol needs to perform consistent checks on the health of loans to guarantee they are always overcollateralized, ensuring users are protected against under-collateralization risks.
Since cryptocurrencies trade across hundreds of centralized and decentralized exchanges simultaneously, it’s key that Venus have aggregated, volume adjusted market prices reflective of all trading environments when issuing and liquidating loans. Such aggregated price information is not inherently available on BSC, thus, requiring an oracle to retrieve it and broadcast it on-chain. This is where Chainlink comes into play.
“As the market leader in providing credit to the BSC ecosystem, it was critical that we scale up our security by upgrading to Chainlink as a means of thoroughly protecting our users’ funds and guaranteeing they alway get fair market prices. Not only are we able to leverage Chainlink’s time-tested security, but it’s native operation on BSC allows us to get consistently fresh data for a much lower price.” — Joelito Lizarondo, Founder Venus Protocoland CEO of Swipe Wallet.
What is Chainlink?
Chainlink is the most widely used and secure way to power universally connected smart contracts. With Chainlink, developers can connect any blockchain with high-quality data sources from other blockchains as well as real-world data. Managed by a global, decentralized community of hundreds of thousands of people, Chainlink is introducing a fairer model for contracts. Its network currently secures billions of dollars in value for smart contracts across the decentralized finance (DeFi), insurance and gaming ecosystems, among others.
What is Venus?
Venus Protocol is an algorithmic-based money market system designed to bring a complete decentralized finance-based lending and credit system onto Binance Smart Chain. Venus enables users to utilize their cryptocurrencies by supplying collateral to the network that may be borrowed by pledging over-collateralized cryptocurrencies. The difference of Venus from other money market protocols is the ability to use the collateral supplied to the market not only to borrow other assets but also to mint synthetic stablecoins with over-collateralized positions that protect the protocol. Venus utilizes the Binance Smart chain for fast, low-cost transactions while accessing a deep network of wrapped tokens and liquidity.
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