Currently, Kashi Lending is solely pulling data from Chainlink oracles via the VWAP method and plans to integrate Sushiswap TWAP. It is important to have more oracles offering support for a wider and deeper breadth of data for the Kashi Lending product. DIA’s VWAP oracles combine a preferred volume-weighted price with a broad coverage of digital assets.
Sushiswap launched Kashi with Chainlink being the sole oracle feed. However, the lack of decentralized oracle solutions on Sushiswap causes problems. As talked about by Orionmuir, relying on Chainlink to deploy the necessary oracles onto Kashi stalls the acceleration of new products that can be offered–especially across multiple chains.
DIA is a product driven by users. Requests for new datasets are community driven. So, if there were a need to oracalize new token pairs that are unusual such as X or Y token, it wouldn’t require any discussion with the DIA team, but just require a ticket to be submitted. We believe this would be very beneficial as the oracle wouldn’t be the limiting factor for spinning up new markets.
The choice of VWAP methodology and multiple sources makes us a more resilient option compared to other TWAP based oracles. The DIA methodology calculates VWAPs from a set of constituents (centralized and decentralized exchanges). USD-denominated prices are calculated once every second based on local exchange executions.
We believe that a VWAP index price feed is a more accurate representation of the fair market price.
TWAP vs VWAP
- Sushiswap TWAP oracles only pull data from a single exchange which lacks market coverage and introduces vulnerabilities.
- TWAP by nature is a lagging indicator, which falls out of sync with high market volatility. This could lead to Kashi ingesting bad data that can lead to unwanted liquidations.
Summary of Benefits
- Fast and community driven deployment of VWAP price feeds on different EVMs
- No tradeoff between lack of choice of assets (Chainlink) and resilience of data feed (Sushiswap TWAP)
- Higher transparency on price feed calculation and source
- Freedom of choice
- Add DIA VWAP Oracles
- Do not add DIA VWAP Oracles