LCX Chooses Chainlink to Provide Credible Reference Prices for Cryptocurrencies

by LCX Team

LCX takes another big step towards transforming the speculative crypto market into a mature token economy by collaborating with Chainlink, the market leading decentralized oracle network. LCX is now a data provider to the Chainlink network, allowing us to provide secure, reliable, transparent, and compliant reference prices to the decentralized finance (DeFi) ecosystem, which are important to institutional investors in highly regulated traditional financial markets.

Read the Press Release at PRNewsWire

What are LCX Cryptocurrency Reference Prices?

LCX is headquartered in Vaduz Liechtenstein, a reputable international financial center that has introduced a legal framework for blockchain companies, referred to as the “Blockchain Act”. In March 2020, LCX announced the launch of LCX Cryptocurrency Reference Price Services, which is a service that became regulated by the new Liechtenstein Blockchain Laws as Trustworthy Technology Reference Price Services. Operators of the TT Price Services and other blockchain-based services are supervised by the Liechtenstein Financial Market Authority (FMA).

LCX’s Cryptocurrency Reference Price Services are a daily Bitcoin Reference Price (BRP) in USD and Euro and Ethereum Reference Price (ERP) in USD and Euro. Each day, the LCX Reference Prices are derived from the aggregate trade flow of major cryptocurrency spot exchanges during a specific one-hour calculation window. Our Cryptocurrency Reference Prices provide a credible reference price to the marketplace in order to enhance market participants’ risk management of digital assets and accelerate the professionalization of digital asset trading.

Why do we need oracles?

Blockchains have come to support the growth of decentralized finance, a set of blockchain applications that recreate and expand upon many traditional financial instruments using smart contracts. A key component to these financial instruments is price feeds, which provide valuations to assets and collateral. Since blockchains cannot natively communicate with anything outside their own networks, an additional piece of infrastructure known as an ‘oracle’ is required to bridge the gap between the two environments.

LCX has always prided itself in being ahead in regards to bringing the token economy closer to Institutional Investors. Thus, we will use oracles to bring our trusted source of real-time cryptocurrency price information onto the blockchain in order to improve complex financial instruments and fulfill the need to provide a secure environment for institutions.

How LCX uses Chainlink to Provide Smart Contracts with a Compliant Price Feed?

Chainlink is an open-source, decentralized oracle network that serves as a secure and reliable communication bridge between smart contracts and everything outside the blockchain (off-chain) — data providers, web APIs, enterprise systems, cloud providers, IoT devices, payment systems, other blockchains and much more. It’s the most used price feed oracle throughout DeFi (securing $1B+) and provides secure oracle solutions to leading enterprises like Google, Oracle, and SWIFT.

LCX is set to become a Data Provider to the Chainlink network to provide reliable daily reference prices to the ecosystem. LCX is the first service provider worldwide to publish its reference prices on-chain through Chainlink. Due to Chainlink’s secure, reliable, and open-source infrastructure, LCX is able to publish its credible reference prices on the blockchain in an easily verifiable and immutable manner. LCX’s credible reference prices are then available to be used by DeFi applications, traditional financial infrastructure, enterprises, governments, and more dealing with digital assets.

Cryptocurrency reference rates are often used as the basis for daily exchange rates in traditional transactional platforms and decentralized financial (DeFi) applications, as well as to assign valuation to assets in corporate financial statements, tax returns, statistical reports, digital assets analyses, and more.

Technical Integration

How LCX Reference Prices are used in the Chainlink Network?

With LCX being a Data Provider, we will provide APIs that provide access to our Reference Prices for ETH/USD, ETH/EUR, BTC/USD and BTC/EUR. These APIs require authentication in order to access, which means the oracle needs credential management capabilities to retrieve the data. LCX will provide Chainlink with a Secret Key and that key will be used in the External Adapter of the Chainlink Nodes to allow them to call LCX Reference Price APIs. Chainlink will then call LCX APIs daily to get the latest price and use it in providing price feeds to the Chainlink Network.

How Smart Contracts request LCX Reference Price using Chainlink Oracle Smart Contract?

Your Solidity Smart Contract can call the LCX Reference Price API using the following code snippet with Truffle:

When you call requestEthereumPrice Function, it sends an on-chain transaction to an Oracle Contract. That transaction transfers LINK, along with the data representing your request, using the transferAndCall function. The Oracle Contract tracks LINK balances from requesters and emits an event when it receives LINK via transferAndCall. This notifies the off-chain Chainlink network that a request has been initiated. Chainlink nodes monitor the blockchain for these events and will begin the process.

Creating and Receiving Requests

With the request received, Chainlink performs the work of the request and returns the answer to the oracle contract. The Oracle Contract updates the LINK balance to pay the node operator and returns the result to the Consumer Contract.

We look forward to providing data to the Chainlink ecosystem and providing institutional entities with access to secure, reliable, transparent, and compliant blockchain-based price feeds

About Chainlink

If you’re a developer and want to connect your smart contract to off-chain data and systems, visit the developer documentation and join the technical discussion on Discord. If you want to schedule a call to discuss the integration more in-depth, reach out here.

Chainlink is an open-source blockchain abstraction layer for building and running decentralized oracle networks that give smart contracts on any blockchain access to secure and reliable data inputs and outputs. It provides oracles to leading DeFi applications like Synthetix, Aave, and Kyber Network; numerous blockchains such as Ethereum, Polkadot, and Tezos; as well as large enterprises including Google, Oracle, and SWIFT.