Chainlink Data Streams has been introduced, an all-inclusive data solution for the betterment of the DeFi space. It combines low-latency data delivery and automated trade implementation, opening the doors to new-age and speedy derivatives products.
Currently, Data Streams is in the Mainnet Early Access phase on Arbitrum, where the leading DeFi protocol, GMX, is utilizing them to create a decentralized perpetual futures exchange.
In the case of Chainlink Data Streams, dApps feature on-demand connectivity to high-level market data, supported by a decentralized and open framework. This provides DeFi protocols with rapid on-chain implementation of centralized exchange (CEX)-style user exposure.
With more than a quintillion dollars in international assets on the balance sheet, the notional value of derivatives is roughly $1 quadrillion. In comparison, the market for DeFi derivatives consists of only one segment.
Due to the dispersed networks of nodes’ slow consensus-building and update completion rates, decentralized networks are susceptible to latency. In the case of Chainlink Data Streams, dApps are in for a framework and implementation that minimizes the need for trust. This aids DeFi derivatives markets by allowing developers to construct superior products. The first main component of Chainlink Data Streams is the low-latency market data, and the second is the automated implementation.
With the help of sub-second pricing solutions and the option for better on-chain risk management, DeFi protocols can offer more trading opportunities now that Chainlink Data Streams are a part of them. Users are safeguarded from threats pertaining to conflict-of-interest-free data, low-latency tracking, and the commit and reveal framework.
Chainlink Data Streams has a wide variety of use cases in DeFi. Chainlink Data Streams, for instance, can be included into protocols to boost user visibility, and numerous products, including perpetual features, can take advantage of low-latency market data and built-in security to produce an on-chain perpetual futures protocol.
When it comes to decentralized perpetual exchanges, TVL on Avalanche and Arbitrum both agree that GMX is the largest one at the moment. GMX ran its own price oracle and automation platform from the beginning. However, this presented its own set of complications. The GMX community expanded its Oracle framework by introducing Chainlink Data Streams. Currently, GMX V2 employs Chainlink Data Streams to interface with granular market data and automate settlement processes.
The incorporation of Chainlink Data Streams has provided the option for GMX to upgrade in terms of quickness and safety factors. GMX is currently in the position of introducing user exposure similar to centralized exchanges and building on its user base. After the incorporation, various DeFi protocols are incorporated on the Arbitrum Goerli testnet, like ApolloX, DRX Exchange, and others.
The Chainlink ecosystem is experimenting with advanced payment methods for Chainlink service baking monetization and futuristic economic management. The goal is to reduce payment issues for dApps, businesses, and end consumers that utilize Chainlink Services.
Chainlink Data Feeds are the benchmark for pushed-based Oracle solutions offering continuous updates on-chain. Prime protocols like Aave, Compound, and Liquidity are connected to Chainlink Data Feeds for referencing safe and dependable market data while carrying out specific backend activities.