The initiative combines WOO Network’s liquidity provision strategies with Chainlink’s oracle technology to create customized Chainlink oracles based on WOO’s market data…
WOO Network, a cryptocurrency trading platform, today announced WOOFi, a new capital-efficient DEX powered by institutional hedging and market-making techniques. Since Spring of 2021, the WOOFi Swap proof of concept on BSC and Polygon has traded nearly $4 billion in volume, demonstrating the effectiveness of the market-making algorithm known as Synthetic Proactive Market Making (sPMM).
The need for highly reliable market data
The DEX relies on granular market data from the WOO Network to be pushed frequently into the blockchain in order to replicate a CeFi order book on-chain.
Unlike other oracles that push an update after the price deviates a set amount from the previous price, WOOFi needed additional parameters including mid-price, spread, and a liquidity coefficient. WOOFi also requires the oracle to be updated more often to ensure the DEX can operate with 0.1% swap fees.
On top of these demanding requirements, it was also essential that the oracle technology be capable of maintaining highly consistent uptime, even in volatile market conditions. As an industry leader in building decentralized oracle infrastructure, Chainlink was a natural fit for supporting this customized solution.
Chainlink has been operational for 2+ years even during even the most intense conditions, including periods of high volatility and network congestion. Currently, Chainlink supports over 600 Price Feeds across a number of blockchains, and helps secure tens of billions of dollars in on-chain value.
Powering advanced oracles with Chainlink
Thus far, Chainlink has supported infrastructure and data feeds that are maintained by a decentralized network of nodes run by professional DevOps in order to provide users with a reliable data feed.
These initial decentralized oracle networks (DONs) showcase the beginning of a much larger vision of the Chainlink Network, where any number of DONs are running simultaneously and independently of one another with their own custom design patterns, external connections, and security configurations.
WOO Network is leveraging Chainlink infrastructure to build its own independent DONs, which consist of a range of on-chain data feeds and trading parameters derived from WOO network itself.
By combining the experience and technical expertise of Chainlink oracles with the rich market data of WOO Network, it is possible to create customized oracles for WOOFi based on the institutional data and liquidity provisioning strategies of WOO network.
WOOFi is just the first example of the on-chain products that can be created using Chainlink and advanced datasets to benefit DeFi users by delivering institutional-grade liquidity-providing strategies, offering users low fees, deep liquidity, and competitive prices.
Moving forward, WOO Network will work with Chainlink to make these market pricing oracles available to third-party decentralized trading platforms. These platforms may utilize the oracle’s pricing to provide reliable price feeds across a wide range of cryptocurrencies, including the WOO token.