Chainlink has announced the launch of a new pricing methodology called State Pricing, designed for assets primarily traded on decentralized exchanges.
What is State Pricing?
State Pricing refers to the price of an asset determined by the liquidity reserves within DEX liquidity pools. This price 'always exists', enabling continuous pricing for less frequently traded assets while providing resistance against flash loan attacks.
> 'The state price is similar to the mid-price of an order book (as long as the order book exists) and is calculated based on the token reserves within selected, high-liquidity DEX pools,' stated Chainlink.
Supported Assets
Initially, Chainlink will support assets such as wrapped stETH (wstETH), Aave stablecoin GHO, and Coinbase wrapped Bitcoin (cbBTC). The solution is expected to expand in the coming months to cover additional crypto and tokenized assets, blockchains, and DEX protocols.
Benefits for Developers
The benefits of using State Pricing include the ability to assess asset price accuracy, increased market resilience, and improved liquidity. Decentralized finance protocols that have integrated Chainlink State Pricing include Aave, Curve, Lido, and GMX.
> 'With State Pricing, Chainlink shows once again its commitment to continuously improving the pricing algorithms of assets, along with the infrastructure to deliver them onchain—enabling Aave to support a wider range of natively DEX-traded assets with the high standard of security and reliability the protocol is known for,' noted Ernesto Boado, co-founder of BGD Labs.
The introduction of State Pricing represents a significant advancement in asset pricing on decentralized platforms, offering more reliable and adaptable solutions for developers and users.
