JPMorgan and Visa, two major players in the traditional financial industry, have joined the growing trend of incorporating decentralized ledger technology and crypto concepts into their systems. The integration of traditional finance (TradFi) and blockchain technology has become a hot topic as companies race to meet the demands of the burgeoning digital asset industry.
One essential component facilitating this marriage of centralized and decentralized finance is oracle services. Platforms like Chainlink have paved the way by enabling blockchains to access real-time data, such as price feeds, from crypto exchanges and other data sources. However, for the crypto infrastructure to truly thrive, it must rise to the challenge of providing traders with the same minute-to-minute market data they are accustomed to in traditional finance.
Enter Pyth Network. As an oracle service, Pyth feeds real-time data to blockchains, similar to Chainlink. However, Pyth sets itself apart with significantly faster market-focused data feeds, making it better-suited for various financial use cases. Originally built on the high-speed Solana blockchain, Pyth claims it refreshes its data feeds at intervals as short as 300-400 milliseconds. In contrast, Chainlink’s refresh rate can range from minutes to hours.
The speed discrepancy can be attributed to how the two platforms source their data. While Chainlink relies on decentralized consortiums of third-party data providers and node operators, Pyth sources data directly from first-party financial institutions, both traditional and crypto-centric. This approach, although carrying hints of centralization, delivers drastic speed improvements, serving the needs of modern finance.
Pyth’s data accuracy is ensured through a combination of game theory, cryptography practices, and validation services. The Pythnet network aggregates price measurements from multiple sources, but the system faces the risk of measurement errors if multiple sources report inaccurate numbers.
This week, Pyth launched its highly-anticipated PYTH token airdrop. The token not only functions as a cryptocurrency but also grants voting rights in Pyth’s governance system. Over 90,000 crypto wallets that have interacted with the protocol will receive a share of the token supply. As a tactic to attract attention and users, airdrops have become prevalent in the crypto market.
Although currently positioned as the fourth-largest oracle project with $1.5 billion in total value secured, Pyth aims to revolutionize the crypto market infrastructure. With its unparalleled speed and accuracy, Pyth is poised to become a prominent player alongside industry leaders like Chainlink. The race to serve networks continues, with Pyth already serving an impressive 120 networks.