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Opyn v2 Gamma Protocol Launches Using Chainlink Oracles to Settle Options

Opyn v2 Gamma Protocol Launches Using Chainlink Oracles to Settle Options

We are excited to announce that the Opyn v2 protocol is now integrated on mainnet with market-leading decentralized oracle network Chainlink to power the Opyn Oracle module. Opyn v2 protocol went live on December 29th, 2020 with a WETH-USDC options market. These options leverage the Chainlink ETH-USDC Price Feed oracle to obtain the current ETH price used during settlement.

Understanding Opyn v2

Opyn is an open, decentralized options platform built on Ethereum that enables users to trade DeFi options. Aiming to be the most capital efficient options protocol in DeFi, in Opyn, traders and investors can interact with the protocol by depositing collateral in a vault to create and sell put and call options (oTokens), earning premiums on those options. Alternatively, users can buy options (oTokens) to hedge against volatility or make trades.

Opyn v1, built on top of Convexity Protocol, laid the foundation for DeFi options as the first live ERC20 options protocol. For the first time, anyone could create, buy, and sell options on any ERC20 token. Since the Opyn v1 release in February 2020, more than 100 options were launched with over $115m in volume traded.

Over this time, we’ve heard helpful feedback from Opyn users and the community, resulting in the development of Opyn v2 (Gamma Protocol), which lays a foundation for a more capital-efficient and highly liquid options protocol.

Opyn v2 Leveraging Chainlink for higher security and a better UX

Opyn v2 introduces European cash-settled options, which require an oracle to determine the correct payout at expiry. We initially launched WETH-USDC options.

Unlike many DeFi protocols, Opyn v2 does not need an “always up-to-date” price from the oracle since there is no liquidation system and the protocol can’t go bankrupt. However, Opyn v2 requires an oracle to provide the most accurate market prices possible at t...

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