Chainlink has launched a new way to calculate prices for crypto tokens that are mostly traded on decentralized exchanges (DEXs), rather than on big centralized exchanges (CEXs) like Binance or Coinbase. This method is called Chainlink State Pricing.
Why was State Pricing introduced?
State Pricing is made especially for tokens that don’t have much trading volume on CEXs but are very active on-chain. It helps give more accurate and reliable price data for these kinds of assets. This is useful for many decentralized finance (DeFi) applications that rely on trustworthy prices.
User can use State Pricing in two ways:
- As a push-based service using Chainlink Data Feeds,
- Or as a pull-based service using Chainlink Data Streams.
At launch, State Pricing supports several tokens like wstETH, GHO, LBTC, cbBTC, ezETH, and tBTC. Chainlink intends to add additional tokens, blockchains, and DEXs in the future depending on demand. Numerous large DeFi protocols like Aave, Lido, GMX, and Curve are already utilizing or supporting the new pricing system.
State Pricing augments Chainlink’s current approaches such as a volume-weighted average price (VWAP), which averages prices according to trading volume, and a liquidity-weighted bid/ask (LWBA), which takes into account liquidity at bid/ask levels. These models offer DeFi users flexible, reliable pricing options.
All of these are part of Chainlink’s goal to give developers and DeFi users the flexibility to choose the pricing model that fits their needs best, while still relying on secure and decentralized oracles.
Also Read: TRON Adds Chainlink Data Feeds for USD1 Stablecoin
