Shield Protocol Integrates Chainlink For Secure, Stable Price Feeds
We’re excited to announce that Shield Protocol — one of the first on-chain perpetual options protocols built on decentralized infrastructure — has integrated Chainlink Price Feeds on the Binance Smart Chain and Ethereum mainnet. By integrating Chainlink’s industry-leading decentralized oracle network, Shield Protocol has access to high-quality, tamper-proof price feeds needed to allow users to trade at a fair three-way price. This will help provide our users with strong assurances that index prices are accurate and were not be manipulated when used within Shield perpetual options.
Our initial integration involves the use of the following Chainlink Price Feeds: the BTC/USD pair and ETH/USD pair on BSC. We chose Chainlink as our go-to oracle solution because its infrastructure is seamless to integrate and time-tested in production. Chainlink already helps secure leading DeFi protocols responsible for 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.
We introduce the perpetual option, an innovative financial instrument that pioneered the first long-term on-chain options without the effort, risk, or expense of rolling positions. Shield strives to expand on the success of DeFi in the options market.
To secure our stable price feeding, we needed access to 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, so we need to make use of an oracle to fetch aggregated price data off-chain and deliver it on-chain to be consumed by our application.
After reviewing various oracle solutions, we integrated Chainlink Price Feeds because they provide a multitude of critical features such as:
- High-Quality Data — Chainlink Price Feeds source data from numerous premium data aggregators, ensuring broad market coverage through 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 accurate global market prices that are inherently resistant to inaccuracies or manipulation of any single or small set of exchanges.
- Secure Node Operators — Chainlink Price Feeds are 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 — Chainlink Price Feeds are 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 — Chainlink 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.
Soon we will use additional price feeds from Chainlink to accommodate for new trading pairs added to our perpetual options such as EOS, DOT, etc. We are also considering using VRF services to make our order matching on the private pool more random. Additionally, in the long term, Chainlinkthe Keepers could provide more decentralized smart contract automation solutions for Shield protocol and is one avenue we may explore too.
“Chainlink is currently the most stable price feeding service. They also have a time-tested system that’s been in production for many years. The Chainlink team is warm and patient in helping meet our specific oracle needs” — Charles/ Shield Founder
Chainlink is the industry standard oracle network for powering hybrid smart contracts. Chainlink Decentralized Oracle Networks provide developers with the largest collection of high-quality data sources and secure off-chain computations to expand the capabilities of smart contracts on any blockchain. Managed by a global, decentralized community, Chainlink currently secures billions of dollars in value for smart contracts across decentralized finance (DeFi), insurance, gaming, and other major industries.
Chainlink is trusted by hundreds of organizations, from global enterprises to projects at the forefront of the blockchain economy, to deliver definitive truth via secure, reliable oracle networks. To learn more about Chainlink, visit chain.link, subscribe to the Chainlink newsletter and follow @chainlink on Twitter. To understand the full vision of the Chainlink Network, read the Chainlink 2.0 whitepaper.
About Shield Protocol
Shield is building a one-of-a-kind decentralized protocol for future derivatives infrastructure, enabling global borderless access to finance. Upon the Mainnet Beta launch, on a technical and strategic front, Shield’s closing in on being one of the 1st projects to deliver on-chain perpetual options without the risk of margin liquidation.