Chainlink’s (LINK $7.01) low-latency oracles will integrate with the decentralized exchange (DEX) GMX following a successful governance proposal that sought to provide more “granular” real-time market data to GMX v2.
Voting ended on April 25 at 12:00 am UTC, with over 96% of participating GMX tokenholders voting in favor of the proposal.
The new Chainlink oracles — which were built with the input of GMX core contributors — were brought in to improve upon the functionality of perpetual DEXs and price-sensitive trading on GMX, the author of the proposal explained.
In addition, the low-latency oracles are said to strengthen security, further decentralize the protocol and improve upon the user experience, Johann Eid, the head of integration at Chainlink Labs, said.
While these new oracles utilize the same oracle node operators and data aggregation mechanisms used in existing Chainlink reference feeds, Eid explained that the new oracles extract data at a “higher frequency.”
“The new Chainlink low-latency oracles will utilize the same set of oracle node operators and multi-layered data aggregation mechanism currently deployed in existing Chainlink reference feeds, but operate via a pull-based mechanism to meet the speed requirements of DeFi derivatives.”
Eid explained the strengthened security will come from the low-latency oracles providing a “strong degree of tamper-resistance when settling user trades.”
Another Twitter commentator, Aylo, explained to their 62,600 followers on April 8 that the integration would “reduce exposure to stale price execution and value extraction” for GMX derivative traders.
A beta version of the GMX-tailored, low-latency oracle feeds — which have been in the works since 2022 — are now available on the Arbitrum testnet.
In return for the service, Chainlink will receive 1.2% of protocol fees generated by the low-latency oracles from the GMX protocol.
Protocol fees include the fees paid by users from margin trading in addition to standard borrow fees and swap fees.
Eid stated that Chainlink would continue to refine its oracle services to GMX as the protocol continues to “expand” and “evolve.”
Related: Smooth and secure crypto trading? This perpetual DEX is up for the challenge
It appears as though GMX isn’t the first perpetual DEX to get on board with the new type of oracle though.
Matt Losquadro, a former ambassador of on-chain derivatives platform Synthetix, said it integrated a similar solution first, which was observed by a member of the GMX community prior to the proposal being put forward:
The Aribitrum-native GMX also launched on Avalanche (AVAX $16.95) in January 2022. It currently has a combined total value locked (TVL) of $669 million on the two networks, according to data from DeFiLlama.
It is currently the largest protocol on Arbitrum, which itself is the largest Ethereum layer 2 network by TVL.
Chainlink oracles were launched on Arbitrum in August 2021.
USD Coin (USDC $1.00), wrapped Ether (wETH) and wrapped Bitcoin (wBTC) are the three largest tokens held on GMX, with shares of 43.6%, 23.2% and 16% respectively.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.
Recommended Content
Editors’ Picks
Crypto Today: Cardano, XLM, FLOKI lead $3.1 trillion rally, Russia bans crypto mining, Bitcoin eyes $95K
Cardano (ADA) price action ADA’s ongoing rally has been attributed to rumors that the Trump administration could collaborate with the Cardano network to build a blockchain voting system.
Trump administration allegedly seeks to create new crypto position in White House
President-elect Donald Trump and his team are reportedly seeking to introduce a new White House position for crypto policy, Bloomberg reported on Wednesday.
Solana Price Forecast: Traders move 6.7B SOL as bulls target all-time highs
Solana price has succumbed to a 7% dip after rejecting the $250 resistance on Monday. Negative shifts in vital trading indicators suggest bears could delay the all-time high breakout target.
FLOKI to go live on Coinbase few days after the exchange listed PEPE and WIF
Floki Inu (FLOKI) is down 5% on Wednesday following crypto exchange Coinbase's announcement that the token will begin trading on its platform over the next 24 hours.
Bitcoin: New high of $100K or correction to $78K?
Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.