Venus Resilient Oracles Explained

Article
Avatar
Author

Venus Protocol used to be fully reliant on the Chainlink price oracle for fetching prices. This dependence, while generally reliable, created a single point of failure. An erroneous or stale price could, without a secondary mechanism for validation, pose threats such as unwarranted liquidations or inflated borrowing.

In light of these risks, Venus V4 introduced the Resilient Price Oracle, a more robust system capable of pulling data from multiple sources for cross-validation. The Resilient Oracle is equipped with an algorithm to verify prices between two or more sources, providing a safeguard in cases where the primary source proves unreliable or fails.

Furthermore, the improved oracle infrastructure supports the integration of new price oracles in real-time and permits the enabling and disabling of price oracles per token.

The Resilient Oracle is the main contract that the protocol uses to fetch prices of assets.

DeFi protocols are vulnerable to price oracle failures including oracle manipulation and incorrectly reported prices. If only one oracle is used, this creates a single point of failure and opens a vector for attacking the protocol.

For every market (vToken) Venus configures the main, pivot and fallback oracles. The oracles are configured per vToken’s underlying asset address. The main oracle is the most trustworthy price source, the pivot oracle is used as a loose sanity checker and the fallback oracle is used as a backup price source.

Key Features

Resilient Price Feeds

The Resilient Price Feeds replace the single source price provider used in the Comptroller contract with a more robust and reliable solution. This new component not only fetches asset prices from various on-chain sources but also includes a fallback mechanism to protect the protocol from oracle failures. Presently, this feature incorporates:

Chainlink, RedStone, Pyth Network and Binance Oracles, with the possibility of adding more in the future.

Governance Configurations

The Resilient Price Feeds system can be configured by the Venus governance via Venus Improvement Proposals (VIPs). These configurations include pause and resume functionalities for the oracle, price feed configurations, and fixed price settings, among others.

Safety Measures

In implementing the Resilient Price Oracle, several safety measures have been adopted to ensure the security and continuity of the Venus Protocol:

  • Price Continuity: Asset prices pre and post upgrade were validated in a simulated environment to ensure consistency.
  • Testnet Deployment: The oracles have been deployed and tested in the Venus Protocol testnet environment.
  • Auditing: The code has been audited by OpenZeppelin, Peckshield, Certik, and Hacken.

Venus Resilient Oracle is configured on Ethereum, OpBNB and Arbitrum, apart from BNBChain with VIPs

If you would like to read more in-depth about our Resilient Oracles, you can check out these articles and docs:

Articles:

Docs:

Audits:

The content of this article is not Financial Advice. It covers the Venus Resilient Oracles for educational purposes only.

To stay up to date with the latest developments and progress, you can visit the Venus Protocol Website and Dapp.  For the latest news and events, we invite you to visit the VenusStars website. To receive the latest updates, please follow us on Twitter and in our Telegram Announcement Group. We also invite you to join to our global community on Telegram for a broader discussion.

Related Tags: