DeFi data manipulation is too easy — and current oracle solutions aren’t helping much
Time-weighted average price and/or volume-weighted typical cost for differing durations of time, depending on the DeFi jobs use case, can also reduce attacks for less liquid costs. By using averages throughout time and volume, a sudden and short-lived shock in price has less impact on the reference price. Utilizing varying approaches, the suggested volatility is backed out based on the choice cost, time to maturity, strike rate, spot price and dominating interest rates.
The most current crop of victims includes such projects as Harvest Finance, Akropolis, Value DeFi, Origin and of course Compound.When exploits do happen, they typically include controling the referral cost like ETH/DAI on a data source, such as Curve, Kyber or Coinbase Pro. Every oracle is structured in a different way in its preferred sources of information; how they come to a consensus on the data; and how they calculate those prices. Time-weighted typical cost and/or volume-weighted average cost for differing durations of time, depending on the DeFi tasks usage case, can likewise alleviate attacks for less liquid costs. By utilizing averages throughout time and volume, a unexpected and short-term shock in price has less impact on the referral cost. Using differing methods, the indicated volatility is backed out based on the alternative cost, time to maturity, strike rate, spot cost and dominating interest rates.
DeFi data manipulation is too easy — and current oracle solutions aren’t helping much
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