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Breakpoint 2023: Soon™ - Pyth

Pyth Network transitions to a new era of decentralized finance with its cross-chain data solutions.

The notes below are AI generated and may not be 100% accurate. Watch the video to be sure!

Summary

In a recent announcement from Pyth Network's contributor, Mike Cahill of Dural Labs, key developments on Pyth's journey, its impact on the decentralized finance (DeFi) sector, and the announcement of a retrospective airdrop were detailed. Pyth, known as an Oracle for blockchain, has successfully addressed the challenges of providing trustworthy and low-latency data for blockchain application by attracting a vast network of data publishers. As Pyth stands out in the competitive Oracle market, it also reveals its extensive cross-chain integration and outlines future governance and decentralization plans through a community airdrop initiative.

Key Points:

The Role of Oracles in Blockchain

An Oracle's function within a blockchain is vital, as it provides access to external data that the blockchain would not have otherwise. This data is essential for a variety of applications to function correctly, and Pyth specifically provides a decentralized method of delivering it. By incentivizing data publishers to contribute directly to the blockchain and reducing the need for intermediaries, Pyth ensures that the data is both prompt and reliable.

Pyth's Competitive Advantage and Proof Points

Mike Cahill addressed how Pyth Network has successfully demonstrated its value proposition in the Oracle market, overcoming an initial "cold start" problem to amass a significant number of contributors from trading firms to small exchanges. Pyth has also distinguished itself in competition with other Oracle services like Chainlink, securing a dominant market share on the Solana blockchain within months of launching. The network's low-latency, high-quality data offerings have made it the go-to Oracle for many developers.

Cross-Chain Integration and the Introduction of PIPNet

The integration of Pyth across multiple blockchain platforms has been a considerable part of its success in 2023. With the introduction of PIPNet, developers can now pull the oracle data they need across different chains, allowing for more flexible and efficient data usage. This novel mechanism has led to rapid adoption, with Pyth becoming available on numerous blockchains and gaining remarkable market share.

Community Governance and Decentralization

A fundamental aspect of Pyth's progression is the move toward increased decentralization and community governance. The announced retrospective airdrop is a step toward this, by rewarding users across multiple blockchains who have participated in applications powered by Pyth. This initiative marks a transition to community-run governance and opens up the potential for a decentralized oracle entirely controlled through collective decision-making.

Facts + Figures

  • Pyth's vision is to offer real-time data with minimal delay, catering to the high demands of modern DeFi applications.
  • In 2022, the revenue from the top six exchanges for financial market data was $6.5 billion, demonstrating the value of the industry Pyth is disrupting.
  • Pyth has drawn in large trading firms and small exchanges, with three new publishers joining the network monthly.
  • Within seven months of launching on Solana, Pyth captured a 90% market share, while rival Chainlink managed only 5% after its launch.
  • Pyth has greatly expanded in 2023, with three applications integrating Pyth every week and availability across 35 different blockchains.
  • Eligible users of Pyth-powered applications can claim SPL tokens through the PIP retrospective airdrop via airdrop.pip.network.
  • The governance of Pyth will eventually be in the hands of its community, with the power to make decisions on fees, publisher rewards, software updates, and asset inclusion.

Top quotes

  • "The first Oracle networks solved for trust at the expense of speed."
  • "The PIP thesis is that DeFi needs trustworthy data with a low latency."
  • "Every month, three new publishers joined the PIP network."
  • "Within seven months, PIP had a 90% market share from the total value secured on Solana."
  • "Three new applications integrated PIP every single week in 2023."
  • "PIP is now available on 35 different blockchains."
  • "There are 75,000 unique wallets that will be eligible on 35 blockchains for the retrospective airdrop."
  • "The PIT network started out as an idea on how to reimagine Oracle data on blockchains."

Questions Answered

What is an Oracle in blockchain technology?

An Oracle in blockchain technology is a bridge that provides access to external data sources for smart contracts that run on a blockchain. It is essential for enabling blockchain applications to interact with real-world information such as market prices, weather data, and other off-chain events.

Why is Pyth Network significant in the field of DeFi?

Pyth Network is significant in DeFi because it offers a more reliable and faster way of providing external data to blockchain applications. It enables high-frequency trading applications to function on-chain by overcoming the challenges of trust and latency that have previously hindered similar projects.

How has Pyth managed to outpace competitors like Chainlink?

Pyth managed to gain a significant advantage over competitors by achieving lower latency data delivery, attracting a broad range of data publishers, and ensuring data quality. These factors contributed to its rapid growth and adoption, capturing a 90% market share on Solana within seven months of its launch.

What does the PIP retrospective airdrop entail?

The PIP retrospective airdrop is a reward system for users of Pyth-powered applications across 35 blockchains. This airdrop aims to incentivize the community as Pyth transitions to more decentralized governance. Eligible users can claim their rewards through the Pyth network website by verifying their eligibility.

What future governance changes are envisioned for Pyth Network?

Pyth Network envisions a future where its governance is entirely community-run, giving control over decision-making to token holders. This includes setting update fees, determining reward distribution, software updates, and expanding the ecosystem. The community will decide the governance structure, ensuring that Pyth operates as a truly decentralized Oracle network.