As a seasoned crypto investor with a knack for spotting promising developments, I find the recent launch of XRPL’s price oracle particularly intriguing. With my extensive background in blockchain technology and DeFi, I can confidently say this is a game-changer for institutional-grade DeFi on XRP Ledger.
As per the recent update from the RippleX‘s official Twitter account, the long-awaited XRPL oracle pricing adjustment has been activated. This change introduces a “Price Oracle” functionality into the XRP Ledger, as outlined in the XLS-47 specifications.
The purpose of the XRPL Price Oracle is to keep track of the prices for asset pairs that aren’t found within the XRP Ledger. This data can then be utilized by smart contracts operating on the XRP Ledger, enabling them to incorporate external pricing information.
The pricing amendment for XRPL (X Ripple Ledger) oracles is now active! We’re excited to announce the integration of Band Protocol and DIAdata, which will enhance XRPL’s native oracle services. These secure, real-time data solutions will significantly boost DeFi features such as Automated Market Makers (AMM) and lending protocols.
— RippleX (@RippleXDev) November 2, 2024
A blockchain oracle functions as a data provider for the blockchain, delivering real-world information that can then be utilized by applications known as decentralized apps (dApps), which predominantly operate within or in conjunction with the blockchain.
Oracles serve as a reliable bridge, securing and efficiently transferring real-world information into a chosen blockchain network, making it accessible for smart contracts. This is of great importance in the context of decentralized finance (DeFi) for institutions, playing a pivotal role in XRPL.
The Oracle of XRPL, unlike external services like Band Protocol and DIA, is inherently part of the network, not an additional layer. This setup resembles XRPL’s AMM. In other words, XRPL’s Oracle and AMM are both native components of the XRPL network. However, external oracles can still connect to XRPL for access to price data feeds.
With the introduction of the new XRPL price oracle, along with its integrations with Band Protocol and DIA, XRPL’s built-in oracles will now provide real-time data crucial for DeFi functions such as Automated Market Makers (AMM) and lending platforms. This progress marks a substantial leap towards high-level DeFi solutions that cater to institutions.
Last week, the update related to Decentralized Identifier (DID) on the XRP Ledger became active, signifying another important advancement. DID represents an individual, decentralized identifier that is not governed by any central power.
Use cases for XRP price oracle
Multiple emerging XRPL systems will rely on oracles, including the XRPL Lending Protocol for setting interest rates and handling loan liquidations, as well as the XRPL Automated Market Maker (AMM) and Decentralized Exchange (DEX) to calculate asset values across both traditional Web2 and decentralized Web3 marketplaces. Additionally, the XRPL EVM Sidechain will necessitate oracles for facilitating EVM smart contracts and swift data synchronization between the mainnet and sidechain.
To utilize tokenized assets effectively, it is essential to have an oracle for XRP price. In February, Ripple and Zoniqx unveiled a partnership aiming to incorporate Zoniqx’s infrastructure for asset tokenization into the XRP Ledger. This means that real-time data on the prices of actual assets needs to be fed directly onto the blockchain.
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2024-11-03 15:10