Building a secure stablecoin with Chainlink’s battle-tested oracle technology
agEUR is a decentralized and overcollateralized stablecoin, and maintaining high levels of collateralization requires transparency and the ability to know, at all times, the value of the assets accepted as collateral to back the stablecoin.
In order to calculate collateralization ratios based on secure price data, a protocol needs to make use of an oracle network to fetch aggregated price data offchain and deliver it onchain to be consumed by our application.
Since the launch of the Angle borrowing module on Ethereum Mainnet in 2022, Chainlink oracles have been a cornerstone of the infrastructure, allowing to track the price of the assets accepted as collateral to borrow agEUR.
Angle’s mission with agEUR is also to expand the possibilities offered in DeFi in a secure and transparent manner. This expansion entails, among other things, the onboarding of new types of assets as collateral to borrow agEUR: offchain assets,often referred to as real-world assets.
Chainlink’s highly secure and reliable technology proved itself useful and efficient to achieve this level of composability and integration between offchain and onchain assets.
Choosing Chainlink oracles for the first offchain assets used to borrow agEUR
Chainlink oracles already play an important role in securing the Angle Protocol borrowing module.
When the Angle DAO engaged in conversations around integrating offchain assets tokenized by Backed Finance to borrow agEUR, ensuring the tracking of the value of such assets was a fundamental piece.
It was important to ensure access to an (i) industry-leading decentralized oracle network, and (ii) high-quality, tamper-proof price feeds needed to help determine the price of real-world assets integrated within the protocol.
Chainlink already had a time-tested infrastructure, with a proven history of reliability, security, and decentralization with widespread adoption within the DeFi ecosystem.
Chainlink Price Feeds have been retained to help secure the use of tokenized real-world assets, such as lB01, as collateral because they provide a multitude of critical features, such as:High-Quality Data — Data is sourced from numerous premium data aggregators, leading to volume-adjusted global market prices with robust market coverage.
Reliable Nodes — Price feeds are secured by a decentralized network of independent, security-reviewed, Sybil-resistant oracle nodes run by leading blockchain DevOps teams with a proven history of hyper-reliability.
Decentralized Infrastructure — Both the data sourcing and transmission on-chain are decentralized, removing any central point of failure.
This decision was positively voted on by the Angle DAO—this increased integration between Chainlink and Angle Protocol is helping take the power of Angle’s borrowing module to the next level with offchain assets.
About Chainlink
Chainlink is the industry-standard Web3 services platform that has enabled trillions of dollars in transaction volume across DeFi, insurance, gaming, NFTs, and other major industries. As the leading decentralized oracle network, Chainlink enables developers to build feature-rich Web3 applications with seamless access to real-world data and off-chain computation across any blockchain and provides global enterprises with a universal gateway to all blockchains.
