Ren has announced a partnership with Chainlink that led to developing a new PoR (Proof of Reserve) mechanism. This PoR mechanism, which is live on testnet and will soon go live on mainnet, will help improve the audibility and transparency of Ren’s cross-chain assets that are bridged on to the DeFi ecosystem.
Collaboration Between Ren and Chainlink
Ren has leveraged a reliable and highly secure decentralized oracle network of Chainlink to autonomously verify every cross-chain asset’s present collateralization that is minted within its ecosystem.
RenVM has about cross-chain assets valued at $270M and around $900M, bridged assets secured and locked using its nodes. This highlights the demand that exists within the DeFi ecosystem for wrapped assets.
All the wrapped tokens must get fully collateralized through assets in their own native chain to maintain Ren’s security and similar other cross-chain protocols. Thus, the adoption of PoR by dApps and users will allow them to leverage and easily audit collateralization of Ren’s assets in a censorship-resistant and automated manner. This will also remove the necessity to rely on off-chain manual verification processes, like reading audit reports every month.
How PoR Functions for RenVM?
For enabling trustless and autonomous verification of all the reserves that back the Ren ecosystem, it will now be possible for smart contract applications to call PoR reference contracts that store information related to Ren assets’ current reserves.
A PoR reference contract gets deployed for all of these cross-chain assets; renZEC, renBCH, and renBTC.
Reasons for Selecting Chainlink
Chainlink was selected since it is the most time tested, decentralized, and greatly adopted oracle within the DeFi ecosystem. Presently, Chainlink’s mainnet also secures billions of dollars for well-known applications such as Synthetix and Aave.
Another reason is its transparency since any user can independently monitor and examine the performance of oracles maintaining the PoR contract on a real-time basis by utilizing on-chain visualization.
Also, Ren will support price reference feeds of Chainlink so that DeFi applications can fetch the actual market price of assets that are based on RenVM. This will ensure that they continue to remain reliable collateral within the DeFi ecosystem.