Hummus Exchange Integrated Chainlink Price Feeds

Published on: 13.08.2022

Hummus Exchange Upgrades to Chainlink Price Feeds to Help Secure Next-Gen Stableswap AMM

The Hummus Exchange integrated Chainlink Price Feeds on Metis Andromeda mainnet. By upgrading to the industry-leading decentralized oracle network, Hummus Exchange has access to high-quality, tamper-proof price feeds needed to help detect if any of the listed stablecoins deviate by more than 2% from their USD peg. This helps protect liquidity providers’ deposited collateral as the protocol will automatically halt stablecoin swaps if it spots a deviation, and will also disable withdrawals of other assets from impacted pools.

The Integration

The initial integration involves the use of the following Chainlink Price Feeds: USDT/USD, USDC/USD, and DAI/USD. They chose Chainlink as the go-to oracle solution because its infrastructure is seamless to integrate and time-tested in production. The Chainlink already helps secure leading DeFi protocols responsible for tens of billions of dollars in smart contract value, maintaining robust security and high availability even amidst unexpected events, such as exchange downtime, flash crashes, and data manipulation attacks via flash loans.

The Hummus Exchange combines the speed, security, and efficiency of the Metis network with an ultra-low slippage stableswap mechanism and dynamic staking rewards system. With a novel approach to the LP token, its flexible liquidity pool architecture utilizes a single-sided staking mechanism, allowing for maximum capital efficiency and ultra-low slippage. Furthermore, adaptative pool composition for tokens enables the protocol to scale organically. As a result of its design, Hummus Exchange allows users to deposit and withdraw seamlessly without worrying about impermanent loss, all with a gorgeous user interface.

In order to help detect if a stablecoin loses its peg, we upgraded our protocol to access fresh asset prices that are supplied directly on-chain in a highly reliable manner. Fair market asset prices should reflect a volume-weighted average from all trading environments. Thus, we needed to make use of an oracle network to fetch aggregated price data off-chain and deliver it on-chain to be consumed by our application.

After reviewing various oracle solutions, they upgraded to Chainlink Price Feeds because they provide a multitude of critical features such as:

High-Quality Data — Source data from numerous premium data aggregators, leading to price data that’s aggregated from hundreds of exchanges, weighted by volume, and cleaned of outliers and wash trading. Chainlink’s data aggregation model generates more precise global market prices that are inherently resistant to inaccuracies or manipulation of any single or small set of exchanges.
Secure Node Operators — Secured by independent, security-reviewed, and Sybil-resistant oracle nodes run by leading blockchain DevOps teams, data providers, and traditional enterprises. Chainlink nodes have a strong track record of reliability, even during high gas prices and infrastructure outages.
Decentralized Network — Decentralized at the data source, oracle node, and oracle network levels, generating strong protections against downtime and tampering by either the data provider or oracle network.
Reputation System — Provides a robust reputation framework and set of on-chain monitoring tools that allow users to independently verify the historical and real-time performance of node operators and oracle networks.

About Chainlink

The Chainlink industry standard for building, accessing, and selling oracle services needed to power hybrid smart contracts on any blockchain. The Chainlink oracle networks provide smart contracts with a way to reliably connect to any external API and leverage secure off-chain computations for enabling feature-rich applications.