LianGuai Encyclopedia | PYTH Airdrop Finally Arrives What is the Pyth Network?
Introducing the LianGuai Encyclopedia PYTH Airdrop Now Available! Discover the Pyth Network and Its Features
Author: Sam Kessler, CoinDesk; Translation: Song Xue, LianGuai
This week, the token airdrop of Pyth Network, a blockchain oracle company competing with Chainlink, has sparked heated discussions, revealing the long-standing struggle among companies to meet the traditional financial demands of the emerging digital asset industry’s infrastructure.
JPMorgan and Visa have emerged as the latest “TradFi” companies by integrating “decentralized ledger” technology and other crypto concepts into their systems.
Oracle services like Chainlink (LINK) have played a crucial role in driving the integration of old and new, allowing blockchains to access information (mainly price information) from cryptocurrency exchanges and other real-world data sources.
However, for the integration of centralized and decentralized finance to thrive, the crypto infrastructure needs to take on this task – meaning traders need to access the market data they are accustomed to in the world of transcontinental cables and high-frequency price feeds, which is updated every minute.
This is where Pyth comes in. Like Chainlink, Pyth is an oracle service – a platform that provides data to blockchains. However, Pyth’s market-centric “real-time data” feed is significantly faster than Chainlink, which should enable the service to better adapt to certain financial use cases.
Originally built on the Solana blockchain
The project was initially designed for the fast-paced Solana (SOL) blockchain and later built its own chain Pythnet based on Solana’s technology. The project claims on its website that it refreshes its data sources at intervals of 300-400 milliseconds. In contrast, Chainlink’s refresh rate can vary from minutes to hours.
Chainlink’s relative slowness is attributed to how it obtains data – relying on a “decentralized” alliance of third-party data providers and node operator networks to report information. Chainlink’s price information is refreshed at set intervals or dynamically responds to market fluctuations (refresh rates can be accelerated through new delay-centered updates).
In contrast, Pyth directly obtains data from first-party financial institutions, including both traditional financial institutions and crypto-centric ones, such as Jane Street and Binance. While this institution-driven system has a “centralized” flavor – which is a curse to the decentralized crypto world – it brings significant speed improvements, several orders of magnitude faster than competing services, reportedly to meet the demands of modern finance.
According to Pyth’s documentation, the Pythnet network also aggregates price measurement results from multiple sources. Pyth claims on its website to rely on various game theory and cryptographic practices to ensure accurate reporting of its numbers.
For example, the “bridge” service called Wormhole that Pyth uses to relay data to the blockchain automatically runs certain checks before reporting data to the blockchain. While these validation services can help protect Pyth’s numbers from tampering, the system may still face measurement errors if multiple sources report inaccurate numbers.
Pyth has launched the highly anticipated PYTH token airdrop this week. The new cryptocurrency will also serve as a voting mechanism in the protocol governance system, meaning users who want to participate in the development of Pyth technology can “stake” these tokens.
A portion of the token supply will be distributed to around 90,000 crypto wallets that have previously interacted with the protocol. The current trading price is $0.33, lower than the peak of $0.51.
In addition to launching a new token market, the protocol often utilizes airdrops as a strategy to attract attention and users.
According to DefiLlama, Pyth Network is currently the fourth-largest oracle project, with a Total Value Secured (TVS) of $1.5 billion. Chainlink has a TVS of $14.7 billion, followed by WINkLink with $7.74 billion and Chronicle with $6.72 billion.
However, in terms of network servicing, Pyth ranks second with 120, trailing behind Chainlink’s 361.