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Case Study: Voltz x RedStone Integration

Discover the results of Voltz x RedStone Integration

The integration of Voltz and RedStone revolutionized DeFi by transposing off-chain SOFR rates to on-chain, leading to the creation of a new SOFR interest-rate swap market on Avalanche. This milestone demonstrates the seamless fusion of traditional and decentralized finance, reaffirming Voltz’s growing impact in the DeFi sector.

What is Voltz Protocol?

Voltz is a novel defi primitive, powering leveraged interest rate swaps. The first ever synthetic interest rate swap AMM, Voltz AMM utilizes concentrated liquidity, creating a market that’s c.3000x more capital efficient. With over $16.8Bn notional traded and over $11Bn notional liquidity provided, Voltz has quickly become a significant player in the DeFi space.

Voltz’s Oracle Needs

The modularity of the Voltz Protocol v1 allows it to back markets built upon any instrument with a variable rate. However, an essential prerequisite is that this variable rate must be available on-chain so that it can be accurately captured and incorporated into the Voltz Protocol.

Before, specific variable rate existed solely off-chain, thus limiting its integration with the Voltz market. However, once RedStone began to publish this rate on-chain, it facilitated the creation of a new market within the Voltz Protocol. Without this critical on-chain provision the market on Voltz would have remained a theoretical concept rather than a functional reality.

Implemented Solution

Redstone was responsible for the delivery of 4 data feeds: SOFR spot value, SOFR effective date of calculator, SOFR aggregate index, and SOFR index effective date. 

The values originate from the official NY FED API, which is actively monitored by multiple nodes. When it comes to data, it is pushed to the Avalanche C-chain immediately after the NY FED publishes new values. The data could be consumed by either querying one of the four PriceFeed contracts or by getting multiple values at once using the Price Adapter smart contract.

Why this Integration Matters?

The initiation of SOFR on the Voltz Protocol signifies a transformation, concurrently forging a link between traditional and decentralized finance. By enabling access to traditional financial markets on decentralized finance (DeFi) rails, it effectively merges these two financial spheres.

“SOFR is not well-known to the public, but it’s a key part of American finance. Bringing it into an on-chain environment is yet one more step toward shifting TradFi onto crypto infrastructure.”

wrote CoinDesk.

Voltz Team Exclusive Interview

Our speaker was Simon Jones, CEO & Co-Founder of Voltz Labs.

Why Voltz chose RedStone?

The Voltz Labs team will work with partners to create an infrastructure that exists around the protocol. However, it’s ultimately the community’s decision whether to use this to create a market, which in this instance they chose to do.

From a Labs perspective, the RedStone team are extremely strong and efficient and their technology is robust too making them great to work with.

How did the integration process look on your end? What was Redtone’s part in that?

Redstone bridged the gap between TradFi and DeFi by bringing NY Fed’s SOFR Rates on-chain. This allowed the Voltz community to launch a SOFR interest-rate swap market on Avalanche.

From a builders perspective how hard is the integration and use of our oracles in your protocol, and how was the cooperation with our team?

It was super straightforward and amazing to work with the RedStone team! One thing we really value is speed and from idea inception through to launch the RedStone team was extremely quick, whilst being diligent, which is a great attribute for any partner! 

About RedStone

RedStone is revolutionizing the Oracles industry by implementing novel modular design and 3 tailor-made data consumption models. You can build the new generation of DeFi & Web3 protocols based on RedStone’s versatile data offering of long-tail, LP, LST, Ecosystem-native tokens, as well as Real World Data and custom feeds.

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