Get the weekly summary of crypto market analysis, news, and forecasts! This Week’s Summary The crypto market ends the week at a total market capitalization of $1,165 trillion. Bitcoin is up by over 2% after a rollercoaster of a week. Ethereum decreased by almost 1% over the past seven days. XRP gained more than 15% in value this week. Almost all altcoins are trading in the green, with very few exceptions. The DeFi sector decreased the total value of protocols…
DeFi: Paxos Adopts Chainlink’s Oracles (LINK) Network
Stablecoin provider Paxos has announced its partnership with Chainlink (LINK) to make use of its oracles. This partnership will promote the distribution of its PAX and PAXG tokens in the decentralized finance sector (DeFi).
Integration of Chainlink’s Oracles Will Improve Paxos Stablecoin assets
Paxos made this development known in a blog post on its website and revealed further details about the partnership. More specifically, Paxos will be integrating Chainlink’s decentralized price feeds for its tokens. This will enable Paxos smart contracts to be provided with tamper-proof and accurate on-chain data. The integration of smart oracles is expected to bring new potentials to the Paxos ecosystem. DeFi protocols will be able to access accurate data based on Chainlink oracles for Paxos tokens.
As part of the partnership, Chainlink will also develop a ‘’Proof of Reserve’’ Data feeds for Paxos assets. This consensus will allow DeFi applications to quickly and easily verify that its reserves back each Paxos token. It should be noted that PAX tokens are fully backed 1:1 by US dollars, and PAXG tokens are backed by gold bars.
Paxos expects that the integration of Chainlink’s oracles will make it easier to support the use of its stablecoins by DeFi protocols since the oracles ensure that tokenized assets are collateralized by real-world assets and provide fair market values in real-time.
A Major Switch to DeFi?
The decentralized finance (DeFi) sector makes heavy use of stablecoins to ensure proper integration of features such as staking, yield farming, and loans. The collaboration between Paxos and Chainlink should strengthen both projects. Paxos also confirmed that it is looking to expend more resources in the DeFi sector as it represents a good opportunity for the blockchain platform.
‘’Paxos is constantly researching and developing better ways to accelerate the adoption of open financial systems. As one of the financial sectors that develop quickly, the DeFi represents a good growth opportunity.”
Decentralized finance (DeFi) has experienced massive growth in the past 12 months. From a $5 billion market value in January 2020, the sector is valued at over $20 billion. Therefore, it is not surprising that Paxos is looking to gain a major foothold in the fast-growing industry.