What Is a ‘Data Feed’ in the Context of Decentralized Finance (DeFi)?
A data feed is a continuous, reliable stream of external information, typically price data, that is supplied to a smart contract by an oracle. In DeFi, these feeds are critical for protocols to accurately calculate asset values, execute liquidations, and manage collateral ratios.
A robust data feed ensures the financial logic of a DeFi application operates on up-to-date and correct market information.
Glossar
Data Feed
Source ⎊ A data feed in financial derivatives is the continuous stream of market information, such as price, volume, and order book depth, originating from exchanges and liquidity venues.
Smart Contract
Code ⎊ The contract is fundamentally self-executing code deployed on a distributed ledger, embodying the terms of the agreement in an immutable format.
Price Feed
Feed ⎊ A price feed is a continuous stream of real-time pricing data from various sources used to determine the fair value of an asset.
Decentralized Finance
Architecture ⎊ Decentralized Finance, within the cryptocurrency ecosystem, represents a paradigm shift in financial infrastructure, moving away from centralized intermediaries towards peer-to-peer systems leveraging blockchain technology.