Oracle System
Overview
Accurate, real-time pricing data is essential to maintain the solvency and reliability of a CDP system like Mynt (USDm). The protocol integrates with the Pyth Network, a high-performance oracle optimized for latency-sensitive DeFi protocols. Pyth provides reliable, decentralized, and tamper-resistant price feeds sourced from institutional-grade market participants.
Why Pyth?
• High-Frequency Updates: Pyth can push updated prices every ~400ms, crucial for liquidations and minting limits.
• Low-Latency: Designed for high-throughput blockchains like Monad.
• Wide Asset Coverage: Supports pricing for major crypto assets, LSTs, LPs, and cross-chain assets.
• Publisher-Based Architecture: Data is sourced from trading firms, exchanges, and market makers.
• Hermes Relayer: Enables real-time price feeds to be published on Monad in a permissionless and efficient manner.
How Pyth Works (Hermes Model)
• Off-chain Publishers submit signed price updates to Pythnet.
• The Hermes Relayer posts aggregate prices to the Monad blockchain.
• The protocol consumes this on-chain price data in smart contracts to:
• Determine vault health.
• Enforce liquidation thresholds.
• Set minting capacity per collateral type.
Feed Reliability and Redundancy
To prevent oracle manipulation and downtime:
• Price Confidence Intervals: USDm contracts can use both price and confidence interval to reject unstable or high-volatility data.
• Fallback Logic (Future): Plans to integrate backup oracles (e.g., RedStone or custom time-weighted moving averages).
• Staleness Checks: Oracle data must be updated within a minimum interval (e.g., 30s) to remain valid.
Sample Oracle Integration Flow
1. User deposits MON into vault.
2. Smart contract queries Pyth feed for MON/USD.
3. Feed returns:
• Price: $45.80
• Confidence Interval: ±$0.12
• Timestamp: within last 10s
4. Contract calculates LTV limits and determines if user can mint USDm safely.
Security Considerations
• On-chain Verification: All data verified cryptographically via Pyth’s proofs.
• Slashing-Resistant: No incentives to lie; malicious feeds are cryptographically detectable.
• Open-Access: Anyone can read and monitor price data transparently on Monad.
This ensures that all vault actions—minting, redeeming, and liquidation—are based on robust and manipulation-resistant pricing data.
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