Bidao to integrate with Chainlink to support different cryptocurrencies as collateral for the Bidao stablecoin
Bidao, a decentralized stablecoin built on Binance Chain, is proud to announce a technical integration with Chainlink, the market-leading decentralized oracle solution. The integration will use Chainlink’s secure and reliable price oracles to power the Bidao stablecoin.
In the initial iteration, Bidao will use and support the ETH/USD, BTC/USD and LINK/USD price reference data contract already running live on mainnet. This will allow us to expand the different types of collateral users can choose when taking out collateralized debt positions (CDP) via the Bidao protocol.
Understanding the Bidao Chain
Bidao is building a new blockchain system dedicated to facilitating a decentralized stablecoin for Decentralized Finance(DeFi). Users can take out CDPs by depositing collateral in a smart contract, which acts as overcollateralization for receiving a loan in the form of a stablecoin.
The Bidao ecosystem uses 2 different tokens: the governance Token BID and the stablecoin BAI. Users can also stake their BID tokens on the Bidao Chain to participate in the network’s consensus and receive passive income. The stablecoin BAI is an algorithmic stablecoin that is pegged 1:1 to the US-Dollar, with a decentralized process similar to MakerDAO for maintaining that peg.
In the initial deployment, Bidao will be completely integrated with Binance Chain and BNB will be used as the collateral backing CDPs. In the future, we aim to be a blockchain agnostic DeFi application and therefore will integrate other blockchains into the Bidao ecosystem. This will now be accelerated via our integration with Chainlink.
The Importance of Chainlink
Due to the way blockchains form consensus, they can only process computation using data already stored inside the blockchain while still retaining security. Similar to computer networks, blockchains can be far more effective when connected to data and systems outside their immediate network (off-chain).
An oracle is a digital agent employed by a smart contract to retrieve and/or connect it to data and systems outside its native blockchain (off-chain). Oracles pull data into the smart contract and/or execute actions on external systems based on predefined instructions and endpoints given to them by the consuming smart contract. To properly incorporate oracles, the data and delivery of that data must be as secure and reliable as the underlying blockchain.
Chainlink is the number one decentralized oracle network in the market and currently provides decentralization at both the oracle and data source level. By using multiple independent Chainlink nodes, the user can protect against one oracle being a single point of failure. Similarly, using multiple data sources for sourcing market prices, the user can protect against one data source being a single source of truth.
Chainlink has a growing pool of 30 independent, Sybil Resistant, and security reviewed node operators run by leading blockchain DevOps and security teams, many of which have extensive experience running POS nodes across multiple blockchain networks. Chainlink has a very expansive ecosystem of over 120+ projects, representing multiple different blockchains and large enterprises, as well as encompassing many different use cases, such as finance, insurance, and gaming.
It currently has 29 Data Feeds for DeFi (Price Reference Contracts) used by many top Ethereum Dapps. Each node draws market data from a pool of seven different highly regarded data aggregator APIs. Their responses are then aggregated into a single data point and updated at specific intervals in the chain, such as by time (daily), variance (every .5% price change), or a customized combination of both (at least once a day + .5% price variance). These reference contracts offer dapps the ability to access market-wide pricing and are redundantly secured by the decentralized oracle calculation.
Using Chainlink to Secure Bidao CDPs
Bidao is now using Chainlink’s Price Reference Data Contracts for ETH/USD, BTC/USD and LINK/USD as secure and reliable price feeds for supporting BTC, ETH, and LINK as new forms of collateral backing the Bidao stablecoin BIA. This Price Reference Contracts guarantee that the pricing mechanism used in the Bidao ecosystem is highly decentralized, secure, and reliable to keep up with network demand.
The decentralized oracle networks sourcing data for both the BTC/USD and ETH/USD price feeds consists of 21 highly secure independent oracles, while the LINK/USD consist of 7. With 7 different aggregators existing on each oracle network, we can be certain that our Stablecoin is powered by prices that reflect market wide price discovery based on sourcing from all the top liquidity sources. This insures Bidao is resilient against oracle manipulation, specifically attacking low liquidity exchanges to manipulate prices.
“We are a security before everything project that believes deeply in our obligation to the community to build Bidao as secure as possible. Users trust us with their hard-earned money and therefore it is our mission to make sure it is as secure as possible! Chainlink substantially hardens our pricing mechanism using the most decentralized and secure oracle infrastructure in the market, ensuring that user’s funds are never at risk. This has fast tracked our development process and expanded our product offering, all while retaining the utmost security.” -- CEO Bastian Aigner
Bidao utilizes a completely decentralized proof-of-stake Blockchain with an additional collateral-backed stablecoin BAI. It’s stable value comes in sharp contrast to the widely fluctuating cryptocurrencies of other networks, such as Bitcoin, Binance Coin, or Ethereum. As a Settlement Layer the Bidao system utilizes the Binance-chain, which allows users to freely interact with all crypto assets that are running on Binance-chain. In the future, BiDao will be integrated with other blockchains like Ethereum, Bitcoin and Tezos in order to become a one-stop-shop for DeFi applications. Check out our website and whitepaper to learn more and follow us on Twitter for future updates
If you’re a developer and want to connect your smart contract to existing data and infrastructure outside the underlying blockchain, reach out to us here! We can help you quickly and securely launch your data-enabled application or Chainlink Price Reference Data Contract on mainnet today. You can also visit the developer documentation or join the technical discussion on Discord. Learn more by visiting the Chainlink website or follow us on Twitter or Reddit.
Chainlink is a decentralized oracle network that enables smart contracts to securely access off-chain data feeds, web APIs, and traditional bank payments. It is well known for providing highly secure and reliable oracles to large enterprises (Google, Oracle, and SWIFT) and leading smart contract development teams such as Polkadot/Substrate, Synthetix, Loopring, Aave, OpenLaw, Conflux, and many others.