Galaxy Partners with Pyth to Push Better Bitcoin Pricing On-chain
Digital assets merchant bank Galaxy Digital announced today that it has signed a partnership with Pyth Network to serve as an oracle, providing data for its DeFi traders.
An oracle acts as the data gateway between real-world information and the blockchain. It is the layer that queries and verifies external data sources for smart contracts, pricing, transactions, and payment verification, among other things.
Given the explosive growth of DeFi during the last few years, oracles have attracted significant interest from many institutions that are normally in the data provision business, like telecom service providers such as Swisscom which recently joined Chainlink, one of the world’s largest oracles, as a node operator.
Pyth, which went live on the Solana blockchain in late August, and was backed by fundraising from Solana Labs, describes itself as an “oracle solution for latency-sensitive financial data that is typically kept behind the ‘walled gardens’ of centralized institutions.” Other stakeholders that are also contributing to the Pyth network include some of the biggest names in crypto and finance, such as FTX, Coinshares, and DRW Cumberland.
Galaxy’s James Roth says this partnership will include Galaxy providing bitcoin prices in a sub-second timescale to the Pyth Network. Galaxy is the latest in a growing list currently numbering some 20 other firms that provide data to Pyth.
Roth explained that for Galaxy, they believe that there’s a massive value creation opportunity in being able to create “high fidelity, high quality, and trustworthy data” that sits on the blockchain and powers decentralized applications. After all, there is a world of data providers out there, but even some well-known names admitted to data integrity issues in the past. For institutional investors looking to deploy billions into the market, this is going to be unacceptable.
Pyth is an outgrowth of the Solana ecosystem, but future plans include support for Ethereum, Binance Smart Chain, and Terra, all of which rely on their own oracle solutions today. As other experts in the field, such as Chainlink’s Sergey Nazarov, have underscored, the reliability of data from these oracles is essential for the long-term health and growth of DeFi.
