Welcome to the fourth installment of the Pythiad, the Medium Pyth Network newsletter!
For those who missed Pythiad #1, Pythiad #2 or Pythiad #3, be sure to check them out. We covered just about the entire history of Pyth network, from our ‘hello world’ moment to our various partners, including our data providers and partner projects utilizing our feeds.
To our followers, we say thank you again for all your support, feedback, and positivity! And to our newcomers, we say welcome.
We are delighted to have you on board. As always, there is much to discuss.
- Pyth Network Developments
- Solana Ignition Hackathon
- Solana Breakpoint Conference
- Pythian Community
Pyth Network Developments
Since the release of the last Pythiad, a month ago, some updates have made the headlines such as Two Sigma Securities, 0X, and Alameda Research joining the growing roster of now 35 data providers (wen 50?). Other developments were more lowkey, though discoverable for the most dedicated Pythians. Everyone’s work the past month represents another critical step towards the next generation of DeFi.
The crypto world never sleeps, and new tokens appear every day across the vast expanse of permissionless markets. The Pyth network is designed for sourcing only first-party data for multiple reasons relating to quality, speed of access, and legal factors. This means that there may be hurdles to immediately listing some of the newer and shinier tokens as price feeds, as reliable sources need to be secured. There also is a level of development work required to add new asset classes, but we continue to welcome feedback as we gauge community appetite in building the top oracle solution.
Nevertheless, within the month of October, 4 markets have been added to the network:
- ADA/USD (Crypto)
- ATOM/USD (Crypto)
- DOT/USD (Crypto)
- USD/SGD (FX)
To review all of our available price feeds, have a look at our markets page. We welcome all feedback and requests regarding the next set of instruments and asset classes — the world of data is big, and we are just getting started here at Pyth!
Moar robust feeds
As the new feed side remained quieter than usual in October, the number of active providers per asset was not, and this will provide a much more significant resiliency (and accuracy) to those price feeds and the consumers counting on those.
The below table reports the number of active publishers per asset on 01.11.21
Even though, the Pyth network is still relatively nascent (only 2+ months of mainnet), we are very proud of our partners and publishers as they ramp up their asset coverage on the Solana mainnet and help us in offering the best product possible to users.
For instance, the Pyth network BTC/USD feed now receives quotes from 26 different 1st party data publishers (ranging from US accredited exchanges, crypto exchanges and trading firms). With each publisher expected to provide market data on par with Solana slots, this means that a single provider pushes about 170,000 quotes per day per asset, and in BTC case, the Pyth feed aggregates about 4.5M inputs per day.
For developers, reliable and comprehensive documentation is a must as it supports one onboarding into getting familiar with a new (and oftentimes completely different) protocol and code structure without anyone to help. With this in mind, the Pyth team is working on building comprehensive documentation for (prospective) users of our HiFi price feeds.
Last month was released a Best Practice guide for protocols that are or look to consume Pyth’s price and confidence interval. TL;DR, check the number of active publishers and product status (is it “Trading” or “Unknown”, a product is “Unknown” when it has less than 3 active / “Trading” publishers), and take into account the Confidence Interval.
This month, we saw a revamp of existing pages to provide greater clarity on how the Pyth network protocol works such as the Design Overview and its Account Structure. Was added this month to the docs the Price Aggregation explainer — which you can also find directly in our GitHub.
If you were to have any questions, be sure to drop by our Discord and ping the Pyth team, we will be stoked to help out.
The past month has been the busiest ever for the Pyth network and its amazing roster of publishers as we welcomed 10 new participants. These new additions to the growing community will provide 24/7 high-fidelity cryptocurrency, equity, FX, and commodity market data, further strengthening the quality and reliability of the Pyth aggregated crypto feeds.
- Founded in 2019 by diverse members of the global financial community, Members Exchange is an innovative, customer-centric market operator, focused on creating and promoting a fair, transparent, and efficient experience for all investors.
- In its first year of operation, MEMX grew to be the largest independent exchange with the sixth-largest market share of the sixteen U.S. equity exchanges.
- The exchange trades more than 7,500 symbols and continuously quotes at the best market prices in thousands of securities throughout much of the day.
- Founded in 2004, Flow Traders is a leading global financial technology-enabled liquidity provider in financial products.
- Historically specializing in Exchange Traded Products (ETPs), Flow Traders now ensures the provision of liquidity to support the uninterrupted functioning of financial markets across multiple asset classes, enabling investors to continuously buy or sell ETPs or other financial instruments under all market circumstances.
- Founded in 2013, the platform is one of the oldest cryptocurrency exchanges in the world and serves today over 6 million users, offering over 1,700 trading pairs with 1,000 different cryptocurrencies listed on the main exchange.
- Since September 2021, daily spot volumes traded on Gate.io have continuously surpassed $1B, with a peak at $2.8B.
- GHCO is one of the fastest-growing liquidity providers specializing in exchange-traded funds.
- Throughout a single trading day, GHCO quotes thousands of products and helps asset managers to bring even the most niche and esoteric products to market.
- 0x Labs are the creators and core contributors to the 0x Protocol, a decentralized exchange infrastructure for the internet.
- Since its inception, the 0x Protocol has enabled the exchange of more than $94 billion in tokenized value across approximately 18 million crypto trades.
- OSL is the world’s first and only insured and SFC-licensed digital asset platform, providing prime brokerage, custody, exchange and SaaS services for institutional clients and professional investors.
- Founded in 2018 and based in Hong Kong, the company is backed by Asia’s leading public fintech and digital asset company, BC Technology Group (stock code: HK 863). OSL is the region’s most comprehensive licensed digital asset platform.
- Two Sigma Securities (TSS) is a systematic liquidity provider and trading business. Founded in 2009, its goal is to bring together the brightest minds in quantitative research, engineering, and trading to make global financial markets more efficient
- TSS trades globally across asset classes, leveraging its high-performance trading system to regularly execute over a billion shares per day.
- Alameda Research was founded in October 2017. They manage over $1 billion in digital assets and trade $1–10 billion per day across thousands of products: all major coins and altcoins, as well as their derivatives. They have a full-scale global operation with the ability to trade on all major exchanges and markets.
- With an established presence in Hong Kong, the United States, and Japan, Alameda has a full-scale global operation with the ability to trade on every market, on every exchange. With decades of experience, they have built the most sophisticated trading system in the crypto world and quote tight OTC spreads.
- Belvedere Digital Assets is an affiliate of Belvedere Trading, collectively Belvedere.
- Belvedere will initially contribute its crypto assets data to the network and expand its contribution to equities and other products over the next several months.
- DeFi Technologies Inc. is a digital asset investment firm bridging the gap between traditional capital markets and decentralized finance.
- DeFi Technologies is the only publicly-traded company built to give investors direct exposure to the booming Decentralized Finance market. Our mission is to expand investor access to industry-leading decentralized technologies allowing investors to access the future of finance via regulated equity exchanges.
We still look forward to welcoming many more reputable and high-quality data publishers to our network and co-build the next digital marketplace of institutional grade, high fidelity financial data. To review all our 1st party data providers, you may check the Publishers tab on the website.
Solana Ignition Hackathon
After many weeks of building, the Solana Hackathon: IGNITION, has now rendered its verdict.
Nearly 6,000 participants and 568 projects were submitted to a wide variety of judges, and tracks sponsored by many prominent actors such Microsoft, Jump Crypto, Standard Chartered, Forte, Metaplex, and the Pyth network (among others).
The big Hackathon winner is Katana, an asset management protocol building investment products across the risk spectrum, and received the Grand Champion prize of $75,000 in USD — for more details check the Solana post.
For this hackathon, a Pyth prize ($30k USD) was up for grabs, and 87 projects submitted their project to this track. We are humbled to see all the interest around Pyth and this further fuels our dedication to better Pyth on all fronts: onboarding more 1st party sources for better and more resilient data, more products, and many more new developments to provide a complete HiFi oracle to DeFi.
The Pyth prize winner
HydraSwap is a smart DEX on Solana supported by its game-changing Hydra Market Maker (HMM) to maximize the returns for liquidity providers. HMM core mechanism lies in introducing the oracle price as a reference to imitate manual market-making operations in traditional finance. With HMM, funds will be concentrated around the market price to provide high-quality liquidity. Thanks to the oracle input to HMM, HydraSwap is able to introduce a ‘compensation parameter’ that optimally incentivizes arbitrageur while protecting LP returns. LPs can now achieve up to 4x returns by reducing impermanent loss significantly.
01 protocol is a fully decentralized, cross-collateralized, and cross-margined derivatives protocol, offering binary options and the first implementation of everlasting options on Solana. First introduced by Sam Bankman Fried & Dave White, everlastings are options that never expire (∞) and that constantly readjust their strike price so that traders can be exposed to options without the need to select a strike, select an expiry time, or manually roll over their funds at expiry. 01 uses Pyth price feeds to determine the price of underlying assets and act as the index price and thus enable to calculate funding rates for both the binary and everlasting options.
Lifinity is a highly optimized proactive market maker designed to improve capital efficiency as well as reduce impermanent loss. It also aggregates swaps and finds the best trading route across multiple exchanges. Lifinity uses Pyth’s high-fidelity market data as a key guide in the pricing mechanism. Since the protocol does not rely on arbitragers to adjust the pool balance to the market price, risks of impermanent loss can be reduced.
DeltaFi aims to build the world’s most efficient automated market maker (AMM) on Solana and innovate in the space with an intelligent AMM design. DeltaFi vision is to provide traders, liquidity providers, and professional market makers with optimal user experience:
- Easiest market-making platform for professional MMs,
- Optimal trader experience with minimized impermanent loss
- Sustainable profitability for LPs
To build an efficient AMM market, DeltaFi introduces:
- External market: sourced from Pyth
- Internal market: trade info from the platform
- AMM algorithm: mechanism governing the price with internal and external markets as inputs
Cherub is an Inverse Perpetuals (3, 3) DAO inspired by the Olympus DAO’s (3, 3) and its incentive model to align investors, builders and futures traders. Cherub is a DEX that relies on bonding and uses staked or protocol-owned liquidity in the form of a productive treasury to receive and distribute profits from trading, liquidations, and generally speaking, what a CEX, or insurance fund, profits from. Inverse Perpetuals offered on Cherub are integrated with the Pyth price feeds as the index in order to calculate the funding rate.
DFlow is the first flow market maker (FMM). It matches retail order flow to market makers, who participate in a continuous auction for that order flow. Retail traders are guaranteed not to be front-run by on-chain, immutable code, and Pyth prices: when market makers fill retail order flow, DFlow verifies on-chain (using Pyth) that the price that retail traders are filled at is a best and fair price. Launching on the testnet soon, DFlow opens composability opportunities to other protocols and apps in order to further improve the UX. For ex., a new crypto-first commission-free trading mobile app, that is now economically viable thanks to DFlow’s transparent payment for order flow mechanism
Poseidon is a high-performance liquidation bot for the borrow and lending platform on Solend protocol. Poseidon bot continuously monitors thousands of obligations on the Solend platform in parallel and validates their health based on real-time price movements streamed from Pyth. If an obligation’s borrow utilization threshold is hit, it repays the loan.
Tap Finance is a suite of option strategy vaults, leveraging PsyOptions, aimed at generating sustainable yield for single token assets. Tap Finance’s initial vault will execute a USDC-secured BTC put options selling strategy. The strategy will sell BTC puts on a weekly basis, with a one-week expiration date. If the puts expire out of the money (above their strike price), they will generate a positive yield. TAP Finance has integrated Pyth price feeds for new vault depositors that would receive ownership tokens proportional to the cumulative USDC and BTC vault holdings, with BTC priced at market rate.
RiskSwap goal is to provide users with the ability to trade derivatives such as futures and options on a decentralized exchange with an order book that features proprietary risk management tools. Unlike a wide variety of choices that are currently available in DeFi in terms of financial derivatives, RiskSwap employs the Order Book trade execution model juxtaposed with AMM as a complementary liquidity pool facilitator. The Pyth price feeds are currently incorporated into RiskSwap protocol to retrieve the real-life pricing of assets and calculate the funding rate of perpetual futures. You can test their devnet platform
Soda protocol is a lending solution with an on-chain credit rating system (Sol ID) which will incentivize users to accumulate good on-chain behaviors which can bring, among others, a higher LTV. Soda can also serve as a liquidity pool and leverage provider offering an under-collateralized loan to certified protocols to increase their overall capital efficiency. Those can also acquire credit data in Sol ID to help them provide better service for their users. Pyth feeds are integrated into the dApp to determine the exchange rate between assets to enable users to trade synthetic products.
1Sol protocol is a cross-chain DEX aggregator for decentralized protocols on Solana, enabling seamless, efficient and protected operations in DeFi. 1Sol has the ability to find the most cost-efficient pathway among different DEXs.Through optimizing slippage, swapping fees and token prices and executing trade orders automatically, it helps users carry out more possibly profitable trades. In the latest version of devnet, 1Sol has deployed Cryptocurrency Price Realtime Dashboard leveraging Pyth HiFi feeds. Pyth network feeds will be integrated within this Smart Calculator to help 1Sol offer more efficient swaps to users.
Lagrange: Remittance and Forex trading based on stablecoins, backed by DeFi on Solana blockchain. Lagrange acts as an ECN for digital currencies that directly communicates and interacts with Serum on-chain CLOB, different types of market makers and retail users. The Pyth FX HiFi feeds will be integrated to analyze and act to swaps at the best rate and minimal fees.
We already look forward to the next Solana Hackathon to once again see some of the protocols of tomorrow as well as interact with the future builders of the future of finance!
Solana Conference: Breakpoint
Next week marks the beginning of the 1st ever Solana conference: Breakpoint, in Lisboa, Portugal. From November 7th to 10th, the event organized by the Solana Foundation will gather dozens of worldwide renowned participants of the cryptocurrency ecosystem. The Pyth network will be present on-site and is eager to meet in person all the people working tirelessly to make DeFi a reality to the world and implement itself as the future of finance (shoot us a DM on Telegram @PythNetwork).
Alongside all the official events, the Pyth network is part of 2 private events:
Hosted with Burnt Finance, Figment, Commonwealth, Injective, Wormhole, Audius and Lido, we cannot wait to kickstart (Sun, Nov 7, 2021, 7:00 PM) this Solana conference with a great time and 400 participants.
The following day, with HXRO and Serum, we invite you to mingle with fellow crypto builders and investors from the Solana ecosystem and beyond. The view will be unforgettable from the MAAT Museum so if you want to join us, reach out to email@example.com.
The Pythian Community
The wen-token-3 has landed into the Pythians’ wallet!
More than 1.4K Pythians had the honor of receiving the above NFT (community created) in their Solana wallet last week. With a mint of 1,500 units, it means that some of these NFTs are remaining and will soon be up for grabs by community members, so stay tuned and be sure to wander around our socials (wink wink in Discord).
Once again these Pyth NFTs are of purely sentimental and aesthetic value and do not hold any role within the Pyth network strictly speaking.
Where you can follow us
No new communication channel since the Pythiad #3 last month. If you would like to see Pyth expands to a new social horizon, let us know on Telegram or Discord, we will do our best to meet your demands and ease your work in following us and everything that happens.
Below are all the places you can currently follow us, interact or keep updated on all Pyth related things, whether it’s about data providers, protocols, or the general ecosystem:
We’ve got abundant love here at the Pyth team and we cannot be more grateful to all of you!
As for last month, here is a medley of the online messages we loved seeing.
This is the end of Pythiad #4!
If you want to catch up on the first → Pythiad #1: The Journey so Far
If you want to catch up on the second → Pythiad #2: Liberating First-Party Data
If you want to catch up on the third→ Pythiad #3: Pyth Laboured in September
Future newsletters will continue to summarize Pyth’s monthly progress and exciting things happening in our ecosystem. They will be sweet, succinct, and pithy.
Thank you for reading!
We can’t wait to hear what you think! Feel free to join any of the Pyth channels (linked above) to let us know how we can improve!