Oracles

Solistic Finance: Oracle Strategy and Security

Solistic Finance employs a robust oracle strategy to ensure accurate, reliable, and secure price feeds for its lending protocols. This strategy combines industry-leading oracle solutions with proprietary defence mechanisms to safeguard the protocol against potential attacks and manipulations.

Oracle Infrastructure Solistic Finance primarily relies on Pyth for its oracle needs. Pyth is chosen for its:

• Access to high-frequency price updates

• Decentralised network of data providers

• Growing adoption in the DeFi ecosystem

• Ability to provide low-latency price feeds

Secondary Oracle:

Chainlink As a secondary oracle solution, Solistic integrates Chainlink. This provides:

• Additional data verification

• Increased resilience through oracle diversity

• Access to Chainlink's time-tested reliability and wide range of data sources

Oracle Usage Strategy

Solistic combines data from both Pyth and Chainlink to create a more robust price feed:

• Primary reliance on Pyth data

• Cross-verification with Chainlink data

• Weighted averaging of price feeds when discrepancies occur

Fallback Mechanism

In case of failure or significant deviation in one oracle:

• Automatic switching to the other oracle

• Triggering of alerts for the protocol team to investigate

In-House Defence Mechanisms

Solistic has developed proprietary defence mechanisms to further protect against oracle manipulation and attacks:

Price Deviation Monitoring

• Continuous monitoring of price feeds for unusual deviations

• Automated alerts for significant discrepancies between oracles

• Temporary suspension of affected assets if deviation exceeds predefined thresholds

Time-Weighted Average Price (TWAP)

• Implementation of TWAP calculations for critical operations

• Reduces impact of short-term price spikes or manipulations

Circuit Breakers

• Automatic pausing of protocol functions if oracle data shows extreme volatility

• Gradual resumption of functions to prevent sudden market impacts

Heartbeat Checks

• Regular verification of oracle update frequency

• Fallback to alternative data sources if updates are delayed

Attack Mitigation Strategies Flash Loan Attack Prevention

• Implementation of per-block borrowing limits

• Use of multiple price checkpoints for large transactions

Oracle Manipulation Defense

• Cross-referencing of multiple data sources

• Implementation of price impact limits for large trades

Governance-Controlled Circuit Breakers

• Ability for governance to pause protocol in extreme scenarios

• Tiered response system based on severity of detected anomalies

Continuous Improvement and Monitoring

Regular Audits

• Periodic third-party audits of oracle integration and defense mechanisms

• Continuous internal review and improvement of oracle strategy

Community Monitoring Program

• Incentivized bug bounty program for identifying oracle-related vulnerabilities

• Regular community updates on oracle performance and any detected anomalies

Solistic Finance's oracle strategy combines the strengths of industry-leading solutions like Pyth and Chainlink with robust in-house defence mechanisms. This multi-layered approach ensures the integrity of price feeds, enhances the security of the protocol, and provides users with a reliable and resilient DeFi lending platform. By continuously evolving and improving its oracle infrastructure, Solistic demonstrates its commitment to maintaining the highest standards of security and reliability in the DeFi space.