We are thrilled to announce that OMS is integrating several Chainlinkdecentralised services to support the OMS ecosystem. The first integrations will involve the use of Chainlink Price Feeds to access reference rates on various fiat currencies against USD and Chainlink Keepers to automatically update our reference rates stored on-chain when they deviate from the latest reference rate.
Being the industry leader in decentralised oracle solutions, Chainlink provides OMS with a way to securely and reliably get accurate external data feeds on-chain, as well as to automate key smart contract functions in a verifiable and timely manner, leading to truly decentralised and trusted OMS products. Chainlink has demonstrated historical reliability during heavy market volatility and network congestion over extensive periods of time, making it our top and only choice for servicing these off-chain needs.
OMS Supply Adjustment using Chainlink Price Feeds
Open Monetary System seeks to introduce a suite of products to the DeFi ecosystem that virtualise real-world assets and allow users to predict their rise or fall in price. OMS is an Ethereum-based elastic supply token designed to rebase (inflate/deflate) its supply by automatically distributing it to users in a manner that’s proportional to the percentage of supply they hold. The rebase mechanism is designed to adjust the supply based on specific USD-based price thresholds.
The OMS token is pegged to USD, however, the purchasing power strength of USD changes over time based on prevailing economic conditions. Subsequently, OMS needs to consistently assess the relative strength of the USD at given points in time and then adjust the on-chain reference rate used to calculate the OMS price adjustment thresholds.
OMS determines the purchasing power strength of USD by comparing its value against leading currencies. The OMS Reference Rate (RR) is adjusted based on the relative strength of the USD against other global currencies, namely the EURO, GBP, YEN, and YUAN. Relative strength is measured as a moving average of monthly exchange rate movements for the USD against these currencies.
This is where the Chainlink Price Feeds integration is required. OMS queries the USD-denominated Chainlink Price Feeds for the EURO, GBP, YEN, and YUAN, and then records the values in the OMS policy contract. The average movement in each pair is then calculated, with the aggregated value used to update the OMS Reference Rate stored on-chain.