Band oracles are live on Fantom
We announced our strategic partnership with Band Protocol back in March.
Today, Band oracles are live on Fantom mainnet.
Compared to other chains, transaction fees on Fantom are very low, allowing for faster and more numerous oracle queries. In other words, Fantom DeFi achieves higher feed-price accuracy, mandatory for excellent user experience.
Let’s explore into detail how the Fantom ecosystem will use Band oracles.
Band Protocol will be providing critical data feeds for Fantom’s DeFi suite featuring stablecoin minting, lending/borrowing, and trading of synthetic assets.
Our partnership will extend to other functionalities as Fantom DeFi grows to allow all developers on Fantom’s Opera mainnet to access Band Protocol oracle data for their dApps.
What are Band Oracles?
An oracle is an “agent” that verifies real-world data and brings it to the blockchain to be used in smart contracts.
Band Protocol is a cross-chain oracle platform aggregating and providing reliable and tamper-proof data in real-time.
DeFi utilizes smart contracts built on top of blockchains to eliminate intermediaries and reduce the need for trust. Centralized data sources are susceptible to attacks and would destabilize the system by reintroducing trust and a single point of failure. Decentralized oracles offer a solution using game theory to bring verified external data feeds to DeFi.
By accessing accurate on-chain and off-chain data, smart contracts gain new functionalities.
For instance, oracles may provide price feeds on cryptocurrencies or other assets like gold or stocks, that DeFi protocols can integrate.
Why we chose Band Protocol
Band Protocol is a scalable, low-cost oracle platform that fulfills all the requirements we had for Fantom Finance.
- Scalable: Computations take place on BandChain, a high-performance blockchain based on the Cosmos SDK
- Independent and cost-efficient: Costs are independent of gas costs on Ethereum. Correct data will be delivered on time, even during high network congestion.
- Easy to integrate: Cosmos SDK compatibility enables developers to implement price oracles with little effort. Furthermore, predefined oracle scripts make it easy for anyone to get started.
- Customizable: Developers can create custom oracles that fit their needs, setting specs like external data sources, aggregation methods, and security parameters independently.
- Decentralized: BandChain is decentralized and virtually eliminates any risk of attack using 65 validator nodes.
How Fantom Finance integrates Band Oracles
Fantom Finance is a full-feature DeFi suite that has been in development by the Fantom team since January. Users can lock up tokens (FTM initially, and more tokens later on) to mint fUSD, a stablecoin pegged to the US Dollar. fUSD then can be used to trade, borrow, and lend 176 synthetic assets like fBTC and fETH.
All of that happens in one intuitive interface and runs on top of a fast, scalable, and secure aBFT consensus engine.
When minting fUSD, the protocol must be aware of the FTM price to determine the debt limit. Users can mint 50% of their FTM’s dollar value in fUSD at a maximum. This is where Band oracles come in. The oracles set the price reference for fUSD minting (and debt liquidations in the future) to keep the system well-collateralized and safe.
Band Protocol is an essential building block of fMint, the gateway to Fantom Finance.
In addition to the use of Band oracles in DeFi, Band Protocol’s customizable design enables developers on Fantom to also access a variety of real-world data related to events, sports, weather, random numbers, and more.
As the Fantom ecosystem matures, Band oracles will provide additional data feeds for new future functions.
About Band Protocol
Band Protocol is a cross-chain data oracle platform that aggregates and connects real-world data and APIs to smart contracts. The project also enables smart contract applications such as DeFi, prediction markets, and games to be built on-chain without relying on a centralized oracle’s single point of failure. Band Protocol is backed by a strong network of stakeholders, including Sequoia Capital, one of the world’s top venture capital firms, and the leading cryptocurrency exchange, Binance.
The Fantom Foundation is committed to building technology that is open-source, decentralized, DAG-based distributed ledgers with aBFT consensus. We aim to create fast, secure, and scalable technologies across various industries, allowing organizations, businesses, and individuals to develop decentralized and secure applications, solving real-world problems.