sOIL and iOIL now live on Synthetix, Powered by Chainlink
We are excited to announce that through our partnership with Chainlink, sOIL is now live on Synthetix! sOIL is a Synthetic asset that mirrors the price movement of oil using a Chainlink decentralised oracle network. As usual, there will be two versions of this token available: sOIL will enable users to capture a long position while iOIL will enable users to capture a short position.
sOIL is available on Kwenta and Synthetix.Exchange and can be traded for any Synth with infinite liquidity and zero slippage. Users can now also set up binary options markets with sOIL to trade on the future price of the asset.
Like our other Inverse Synths, iOIL will have an entry price, an upper limit, and a lower limit. These limits cap profit and loss, whenever these limits are reached the token’s value is frozen and won’t change until it is re-deployed.
How sOIL prices are brought on-chain
As outlined in SIP-62, there was considerable work done behind the scenes to enable the launch of sOIL on Synthetix. Like many other natural assets, price discovery for oil occurs predominantly in futures markets, which are made up of individual contracts with varying expiry dates. This creates a problem for finding a single reference price, which Synths require.
We utilise a Chainlink-powered decentralised oracle network to develop a non-expiring Crude Oil Index based on ICE Brent Crude Oil futures prices. The Chainlink-powered oracle allows us to aggregate raw oil data from multiple contracts in the futures market through secure off-chain connection to premium data providers such as XBTO, and deliver this data on-chain in a highly available and manipulation resistant manner using a decentralised network of Sybil resistant oracle nodes.
There is more detail provided in the SIP, but the important thing is that this method is also applicable for other assets with large futures markets, such as corn, wheat, coffee, and more.
The Next Evolution in Cryptocurrency
The launch of sOIL represents the future of decentralized finance — more and more of the traditional market will soon be accessible through Synthetix, and our integration with Chainlink allows us to continually tap into high quality data providers to provision new assets. In the not so distant future, cryptocurrency traders will be able to access an even greater range of assets across industries without leaving their cryptocurrency wallet.
Which Asset Should Synthetix Add Next?
Get Started and learn more
If you’re a developer and want to quickly get your application connected to Chainlink Price Reference Data, visit their developer documentation and join the technical discussion in Discord. If you want to schedule a call to discuss the integration more in-depth, reach out to them here. To learn more about Chainlink, visit their main website or follow them on Twitter.