Although data oracles play a significant role in the blockchain ecosystem (within the DeFi ecosystem in particular) the fact remains that oracles in their present state are either too costly, not scalable, or glaringly lacking in security aspects. There is not a single doubt in the world, that blockchain applications regularly need access to big data on-chain, and that oracles play a significant role in the development of the DeFi ecosystem. Despite this, however, the current generation of oracles leave much to be desired. Some of these problems are:
- Oracles are costly and slow – current oracles process a single piece of data per transaction, increasing transaction fees while making the process extremely slow.
- Very limited crypto data – Leading oracles like Chainlink and Band currently provide only several hundred data pairs.
- Elements of Centralization – Many leading oracles, despite claiming to be decentralized, have various elements of centralization.
However, with the introduction of the Umbrella Network, hopefully, this is all set to change.
Umbrella Network: A Brief Introduction
Umbrella Network is a community-owned, highly scalable and low-cost oracle with the goal to create “a decentralized network invulnerable to influence, manipulation, or attack”, by being one of the first truly decentralized oracle solutions to run on a DPoS (Delegated Proof of Stake) consensus algorithm. As noted earlier, one of the biggest problems in the blockchain and DeFi space is the high cost of getting data on-chain.
This cost is mitigated by an innovative idea, of utilizing a system of Merkle Trees on a layer-2 sidechain to aggregate thousands of pieces of data together and store it on a single blockchain transaction. (As noted earlier, current-gen oracles are only able to process a single piece of data per transaction, making the whole process massively expensive, slow and insecure). This enables the Umbrella Network to bring data on-chain that other oracles simply cannot, while still offering higher levels of scalability and at a lower cost.
In essence, Umbrella Network is
- Cost-Efficient and Fast – as it utilizes a layer 2 sidechain with a Merkle tree system for data aggregation and massive scalability
- Diversified with wide variety of data – Mid and Long tail of crypto markets, volatility data, and real-world non-crypto data like crude and forex made available. Currently offers 1200 data pairs, with plans to include more
- Truly decentralized – with a DPoS consensus algorithm.
Umbrella Network – Project Highlights
Here are some of the key highlights of the Umbrella Network, that makes them stand out from the rest of their competitors:
- Umbrella offers more than 1200 data pairs, including crypto, real-world financial data, synthetics and more. If data is available via API, the Umbrella network can bring it on-chain.
- The Layer 2 Merkle tree-based solution addresses many problems currently plaguing the ecosystem, including the potential to mitigate hacks that happen due to data and price manipulation.
- The native token, UMB is listed on Uniswap, SushiSwap and PancakeSwap, along with centralised exchanges like AscendEx and gate.io. Several reward programs are in place to incentivize long term holdings with high APY (100-400%)
- Successfully completed Polkastarter IDO in February, followed by BSC mainnet launch in June, and an Ethereum mainnet is planned to launch in July. The extension of support to BSC helps the network to take advantage of the lower fees on the Binance Smart Chain network, helping to drive the costs of data to as close to zero as possible.
- Multi-chain interoperability is planned, with additional integration into Polygon, Solana, Polkadot, and Avalanche later in 2021, and additional chains further into 2022. The plan is to be able to support wherever the applications and data will reside, irrespective of the blockchain.
Here’s what the roadmap for the rest of 2021 looks like for the Umbrella Network.
July – August 2021 – Launch Ethereum mainnet, and launch Decentralized governance
Q4 2021 – Integrate with Polygon, Moonbeam & Plasm, Launch Delegated Proof of Stake Consensus. Integrate with Solana, Avalanche, with an increased focus on core product development. Q4 2021 will also mark the beginning of their transition to a fully decentralized, community-owned oracle.
The Team and Investors
The Umbrella Network is led by Sam Kim joined by Miguel Morales, Dariusz Zacharczuk. Alex Voloshko and John Chen. It is backed by popular names in the crypto venture capital space, including CMS, NGC, Spark Capital, Moonwhale, and Kryos among others. The team has forged over 40 strategic alliances over the last year, with notable partnerships including names like Huobi, Elrong, Polygon, Linear Finance, Unilend, Bounce, InfStones, YOP Finance, Polkacover, and Blockbank.
The Umbrella Network seems like the solution that could truly make blockchain and DeFi more accessible to developers, attracting even more innovative products than we see today. If you’d wish to learn more about this project or be a part of their community, here are the links!
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