GMX, a decentralised exchange operating on the Arbitrum (ARB) and Avalanche (AVAX) networks, is to integrate Chainlink’s (LINK) low latency oracles to strengthen its structure. In return, Chainlink will receive 1.2% of the protocol fees generated on GMX.
GMX gets Chainlink’s oracles
Decentralised exchange (DEX) GMX, which operates on Layer 2 Arbitrum (ARB) and Avalanche (AVAX), is to acquire Chainlink’s (LINK) low-latency oracles to improve its structure.
In exchange for its oracle network, Chainlink will receive 1.2% of the protocol fees generated on GMX. Currently, GMX is the protocol with the highest total locked value (TVL) on Arbitrum, ahead of Uniswap V3 (UNI), Radiant (RDNT), Stargate (STG) and Aave V3 respectively.
DEX offers, among other things, spot and perpetual trading via a pool of several cryptocurrencies that pays its liquidity providers. This rather unique process allows GMX to offer low fees and no impermanent loss. To discover GMX in more detail, you can read our tutorial dedicated to this DEX.
Evolution of the total value locked in on GMX from launch to today
According to the governance proposal, Chainlink’s oracles will support the long-term development of GMX:
This proposal provides a key infrastructure solution and development partner to help GMX meet its critical oracle needs. It directly aligns Chainlink with GMX’s requirements for low-latency data flows on specific assets, market metrics and coverage of new blockchains needed to fuel our growth. “
Low latency oracles particularly suited to DeFi
Designed to meet the needs of decentralised finance (DeFi), Chainlink’s low-latency oracles address the unique requirements of decentralised applications (dApps) by providing high-frequency pricing, always with on-chain verification.
Without going into the technical details, low latency oracle networks provide extreme speed, considerable energy efficiency and, most importantly, the ability to prevent arbitration attempts.
Diagram of how Chainlink’s low latency oracles work
Johann Eid, Chainlink Labs’ vice president of go-to-market, says the partnership paves the way for wider adoption of decentralised finance:
Chainlink Labs has been committed to supporting and growing DeFi since its inception. With this collaboration, we mark another milestone for the space and its race towards mass adoption. Low latency oracles will bring the industry closer to the level of performance that currently exists outside of it, while our economic alignment helps lay the foundation for a more sustainable ecosystem. We are excited to continue building this space with leading projects like GMX, one block at a time, until DeFi becomes a leading and secure global financial system.”
