Interest Protocol Is Powering Capital-efficient Financing with Chainlink
Interest Protocol just came up on the DeFi scene as a capital-efficient means of financing. It has a different combination of part reserves and high collateralization. The choice of Interest Protocol for its main oracle has gone to Chainlink.
Interest Protocol’s Cost-Friendliness
Price oracles are an important part of all protocols that runs a lending platform against collateral. The quality of a reliable and accurate oracle is to let loans and liquidations happen fast. It is also efficient in minimizing error margins.
Interest Protocol has integrated the price feeds from Chainlink. The feeds give a tamper-proof and high-quality data price that has been tested in actual conditions. Chainlink has already helped to secure top decentralized finance protocols with billions of dollars worth of smart contracts.
High Security and Speed as Advantage
Chainlink also maintains a high-security level and prompt availability amidst sudden incidences such as market downtime and flash crashes. Interest Protocol utilizes Chainlink as the basic oracle by carrying out a read-base system calling for the most recent price.
This method guarantees the most security and accuracy for both lenders and borrowers.
Interest Protocol has its personalized oracle settings to maximize the security of its protocol and future composition. It also enables the community to cast votes and manage their new assets. Every asset price is combined into the Master Oracle contract.
The Master Oracle contract maintains a data of contracts specific to the oracle which is called Anchor View Relay. Every asset’s AVR has its own primary and secondary oracle, and a configured deviation.
When a price gets utilized in a transaction process, the protocol gets the most recent on-chain report from the primary oracle. It then goes ahead to certify that the value got is in the realm of a particular deviation of the secondary Anchor oracle cost.
If it happens that the major oracle price goes outside the deviation, then the price won’t get updated. The underlying transaction will then be reverted. The oracle operation this way is usually called the circuit breaker.
Further Assurance of Safety
The circuit breaker is a security feature that stops the usage of the protocol till there is a reaction from governance. Or better yet, till the market corrects itself. For additional security, governance can put the reading from an oracle on hold to hold off all transactions that need the asset’s price.
This said setting lets Interest Protocol utilize Chainlink’s oracles as the major price oracle. In the meantime, it creates many security layers to protect its users when rear events occur.
Interest Protocol is going to use Uniswap V3 as its secondary Anchor oracle when it launches. It will be used for wBTC, wETH, and UNI. Although Uniswap can be used, it does not amount to the best DEX anchor for every asset. Interest Protocol system is set up to be usable with various secondary oracles.
In the protocol’s core contract, the Master Oracle is one that is configurable. Interest Protocol eliminates third-party aid in the process of listing assets.