Cardano recorded a first successful integration of an oracle of the name. Her name is Charlie3. Its integration was made by Liqwid, a major player in decentralized finance (DeFi) on Cardano. Despite significant delays in the development of Cardano since the start of the project, this achievement marks a turning point for the ecosystem.
Liqwid: the importance of oracles in making DeFi trustworthy
Liqwid is a decentralized finance (DeFi) protocol on the Cardano blockchain. It allows borrowing, lending and generating returns on deposits. All of this is possible thanks to its algorithmic money market.
The Liqwid protocol is similar to Aave and Compound. However, it is more scalable, secure and offers reduced fees thanks to the Cardano blockchain. The protocol uses a native token called LQ. The latter makes it possible to decentralize its governance and reward users.
To ensure reliable operation, Liqwid needs one or more oracles. It is services providing data to the blockchain. Oracles are essential, as they allow the protocol to know the value of deposited and borrowed assets in real time.
This information is crucial for the calculation of collateral ratios and the management of liquidations in the event of non-compliance with minimum collateral requirements. The data provided by the oracles is recorded on the blockchain. This reduces the risk of manipulation and ensures that the information is up-to-date and accurate.
Charli3 revolutionizes DeFi on Cardano
Liqwid has integrated an onchain oracle called Charli3. This will allow several projects to provide data such as asset prices, weather, game results, sports results, etc.
On the other hand, at first, Liqwid will integrate the price flows for the pairs SHEN/USD and ADA/USD. This real-time information will be used to secure collateral, loan origination and liquidations. Additionally, the protocol plans to add new pairs to satisfy user demand.
In a communicateda member of the Liqwid team said: “Charli3 is Cardano’s first decentralized oracle infrastructure on the mainnet. We worked with the talented developers who built this protocol. Seeing their clear vision of the evolution of DeFi on Cardano has been enlightening and very motivating”.
Until now, Charli3 Oracle connected to external APIs to aggregate prices. Its integration with Liqwid is an important step for Cardano. It will strengthen the security of DeFi. This development will also guarantee the reliability of the data on which loans and borrowings on Liqwid are based, but also minimize the risks associated with the centralization of DeFi on the Cardano blockchain.
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