Defi Money market protocol Compound introduces Price Oracle

Money market protocol Compound announced the release of price oracle. Price oracle constitutes a part of its attempts to transfer to the Open Price Feed.

By Komal Joshi · Aug 8, 2020 . 5min read

On August 7, 2020, Money market protocol Compound announced the release of price oracle. The price oracle constitutes a part of its attempts to transfer to the Open Price Feed. It’s permissionless and upgradable. A price oracle comprises of a third-party, decentralized provision that offers the data required to carry out smart contracts. Several Open Finance platforms utilize price oracles to provide their users with various services like margin trading and lending.

How Money Market Protocol Compound Operates

Developed on Ethereum, the Compound is a system of openly available smart contracts. Compound concentrates on providing borrowers to take out loans by depositing collateral. Moreover, it helps lenders to offer loans by securing their crypto assets in the protocol. Depending on the supply and demand of crypto assets, the borrowers and lenders settle the interest rates. Additionally, with mining of every block, interest rates are developed. Moreover, loans can be settled, and locked assets can be revoked at any time.

Compound’s native token cTokens enables users to gain interest in their money while also being capable of transferring, trading, and utilizing that money in other applications. Thus, Compound reaches out in the tokenization of the assets secured in their system by the application of cTokens.

Exploring Money Market Protocol Compound

According to a Compound blog post on Friday, the protocol has been running testnet deployments for the past ten days. GitHub entails all the details of the testnet. Additionally, Compound is operating an aggregator wherein users can retrieve data on reported prices. Moreover, reporters can access these prices through public API’s. Furthermore, it has developed a continuously updated notebook. It allows anyone to post the prevailing prices to the chain at any given moment. 

Conclusively, Compound creates properly functioning money markets for Ethereum assets. Users can supply tokens to a money market to earn interest, without trusting a central party. Open Price Feed ensures that the crypto community can maintain and upgrade a price feed.

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