Did you know? In the DeFi ecosystem, there’s an important yet often overlooked infrastructure—oracles. These oracles serve as bridges between the blockchain world and the external world, providing various external data to ensure smart contracts can function properly. This article introduces a rapidly rising oracle star—RedStone and its upcoming RED token.
RedStone is redefining standards in the oracle space with its innovative modular design, dual model support, and cross-chain capabilities. In the past year, RedStone has seen a 500% increase in users, covering more than 70 blockchain networks, making it the fastest-growing oracle service provider in the market. Let’s dive deep into what makes RedStone unique and how the upcoming RED token will change the landscape of the oracle market.
What is RedStone?
RedStone is a rapidly growing “modular blockchain oracle provider” that specializes in delivering various data feed services for blockchain applications. It employs an innovative architectural design that stores data off-chain and retrieves it on demand, reducing operational costs while improving system scalability. RedStone’s most distinctive feature is its simultaneous support for both Push and Pull oracle models, with the ability to operate on more than 70 blockchains, including both EVM and non-EVM ecosystems.
As the fastest-growing oracle in the market, RedStone particularly focuses on providing data services for yield-bearing collateral (LST) in lending markets, such as Liquid Staking Tokens (LSTs) and Liquid Restaking Tokens (LRTs). Its modular design enables it to support over 1,000 different use cases and assets, with customizable data feeds tailored to specific needs. RedStone’s ecosystem will be supported by the upcoming RED token, further enhancing its economic scale, security, and sustainability. Currently, RedStone has earned the trust of projects like Morpho, Venus, Etherfi, and Pendle.
What are Oracles?
Simply put, oracles act as bridges between blockchain and the external world, responsible for securely transmitting off-chain data to on-chain smart contracts.
Why do blockchains need oracles? This is because blockchains are essentially closed and isolated environments, unable to naturally communicate with the outside world or exchange information with other blockchains. While this is partly to ensure security, it’s also a significant limitation. Oracles are designed to solve this limitation by connecting blockchains with the external world, providing various data needed to build complex blockchain applications.
The application scope of oracles is extremely broad, capturing data from financial information (such as prices, exchange rates) to supply chain information, and even weather data. For example, lending platforms need to obtain the latest price data through oracles to assess loan limits and monitor collateral ratios; synthetic asset platforms rely on oracles to ensure that cryptocurrencies maintain consistent value with real-world assets.
However, the biggest challenge facing oracles is how to provide reliable and manipulation-resistant data while maintaining blockchain’s decentralized and highly trusted characteristics. This is the so-called “oracle problem”—when blockchains need external data, how to ensure that the oracles providing this data don’t become centralized single points of failure, thus compromising the entire system’s decentralized features and security?
Solving the oracle problem requires consideration of three key factors: scalability, incentive mechanisms, and decentralization. RedStone is committed to addressing these challenges through its modular design and innovative approaches, safeguarding the security of DeFi and blockchain.
What is the Relationship Between RedStone and RED?
RedStone is a modular oracle platform that provides various data feed services for decentralized financial markets; RED is the native token of this ecosystem, providing fuel and security for the entire RedStone platform. The RED token enhances security for RedStone oracles through staking mechanisms, while also incentivizing data providers and community participants. In simple terms, RedStone is the platform, and RED is the token (fuel) that makes the platform more decentralized, secure, and sustainable. Together, they form a complete oracle operating platform.
RedStone’s Development History
RedStone’s story began in late 2017, when the company’s co-founder and CEO Marcin Kazmierczak was writing his bachelor’s thesis on blockchain, Bitcoin, and Ethereum. In 2018, he worked at a blockchain accelerator company in Poland, but unfortunately, the project collapsed, and Marcin went without a salary for three months—a challenging start for a young recent graduate.
A turning point came in 2020 when Marcin’s old friend Jakub Wojciechowski contacted him, sharing an idea about a new type of oracle and inviting him to join the team to disrupt the oracle space. Marcin accepted with hardly any hesitation, co-founding RedStone, and since then, the company’s development speed has been remarkable.
Today, RedStone has grown into a team of 28 people, becoming the fastest-growing oracle service provider in the market in 2024, offering high reliability and high accuracy services to well-known clients such as Pendle, Venus, and Lido. Notably, Marcin was recently selected for Poland’s 30 Under 30 elite list for his contributions to promoting cryptocurrency and Web3 in Poland and globally.
RedStone’s technology has also undergone significant development. Unlike other oracles, RedStone uses a modular design that allows it to efficiently enter numerous new networks. Currently, RedStone deploys a push model compatible with Chainlink on new chains, but the difference is that RedStone’s average delivery time is about one to two weeks, while Chainlink requires approximately three to four months. Additionally, RedStone offers both Push and Pull oracle models, while Chainlink only provides the Push model.
Since its mainnet launch in January 2023, RedStone has not experienced any price manipulation or mispricing events, helping them establish a good reputation in the industry. Many clients now trust RedStone and express satisfaction with its services.
In the future, RedStone plans to provide higher levels of security through its AVS (Active Validation Service) on EigenLayer, especially for critical price information that requires enhanced security. The company is also engaging with approximately 15 traditional financial institutions and has become the only oracle providing fixed interest rates for CoinDesk Indices.
Recently, RedStone is preparing to release its token—RED, which will be another important milestone for the company.
What Problems Does RedStone Aim to Solve?
What pain points in the oracle space does RedStone aim to address? They can be divided into 5 key areas:
1. Solving the Cost Problem
Traditional oracles store data directly on-chain, which is extremely expensive on blockchains like Ethereum. Imagine during network congestion periods, a single transaction might cost over $100. If updates occur every 10 minutes from 30 data sources, the daily maintenance cost for just one token could reach $400,000!
RedStone employs a revolutionary approach—utilizing Arweave, a next-generation blockchain storage technology, to dramatically reduce data storage costs. As of December 2021, storing 1GB of data on Arweave cost just $35, compared to $1.7 million on Ethereum.
2. Solving the On-Demand Data Retrieval Problem
Unlike most oracles that upload information to the blockchain every few minutes, RedStone stores data on Arweave and makes it available to DeFi projects through a node network in the form of decentralized public cache. More innovatively, RedStone’s EVM-Connector technology only transmits data to the blockchain when smart contracts actually need it, rather than periodically pushing all data, greatly saving Gas costs. Meanwhile, each piece of data comes with cryptographic signatures, ensuring authenticity and integrity even when stored off-chain.
3. Solving the Lack of Cross-Chain Functionality
Traditional oracles often focus on just one network, making it difficult to operate efficiently in a multi-chain environment. RedStone’s data signature mechanism is highly flexible—all data is cryptographically signed by providers before storage, allowing it to be verified and used on any blockchain that supports basic cryptographic functions, without requiring special adaptation for each chain, thus achieving true cross-chain compatibility. Although data is stored on the Arweave chain, it can be used with any other blockchain, enabling true cross-chain interoperability.
4. Solving the Lack of Data Flow Flexibility
Different DeFi protocols have different data needs. For example, lending platforms need to use time-averaged price data rather than instantaneous prices to prevent erroneous liquidation of user assets due to temporary market fluctuations (such as sudden price crashes and recoveries). Trading platforms, however, need the latest real-time price information to ensure transaction accuracy. RedStone allows multiple data providers to apply different aggregation rules, offering customized services.
5. Solving Scalability Limitations
Oracles must be able to process tens of thousands of transactions per minute without generating enormous Gas fees. RedStone has significantly reduced oracle operating costs by optimizing its data transmission architecture, achieving a technological breakthrough: the cost of importing and verifying off-chain data on blockchain is even cheaper than reading data once directly from blockchain storage, fundamentally solving the high Gas fee problem faced by oracles.
How Does RedStone Work?
RedStone’s data processing flow begins with the data collection phase. RedStone nodes gather data from multiple sources, including decentralized exchanges, centralized exchanges, and enterprise-grade data providers. These diverse data sources ensure the comprehensiveness and reliability of the data, establishing a solid foundation for subsequent processing.
After data collection, RedStone enters the aggregation and refinement phase. The system processes data using methods such as median, Time-Weighted Average Price (TWAP), or Liquidity-Weighted Average Price (LWAP), effectively filtering outliers and providing more accurate and stable price information, particularly suitable for financial scenarios.
Once data processing is complete, node operators cryptographically sign the data, ensuring its integrity and immutability. The signed data is then sent to an off-chain node stream—known as the “Data Distribution Layer” (DDL). This is a key component in RedStone’s architecture, storing all price feeds in a decentralized manner and providing data support for different oracle models.
Finally, based on specific requirements, data is transmitted from the DDL to the blockchain through different delivery models. RedStone offers various data delivery modes, including Push and Pull models, to meet the needs of different scenarios. In the Push model, data is proactively updated on-chain at predetermined intervals; while in the Pull model, data is only transmitted to the blockchain when a smart contract issues a request, greatly saving fuel costs.
This modular and flexible data flow design enables RedStone to provide precise and fuel-optimized data feeds for various DeFi applications. RedStone has pioneered a new way of oracle service, particularly suitable for new financial assets such as LSTs and LRTs. Through the Pull model, data is only transmitted on-chain when truly needed, significantly saving transaction fees. At the same time, its “chain-agnostic” design allows the same data source to be seamlessly used on any blockchain network. This innovative approach is especially suitable for providing real-time, accurate prices for yield-bearing collateral in lending markets, as these assets typically have unique pricing needs and high-frequency price update requirements. RedStone’s solution ensures these complex assets can be correctly valued and used in DeFi applications.
RedStone’s design philosophy centers on modularity, ensuring the system can adapt to the rapid development of blockchain technology and support the creation of new DeFi products and enhancement of existing applications.
What Makes RedStone Special?
1. Providing Exclusive Data Feeds
Unlike other oracles, RedStone focuses on yield-bearing collateral in lending markets, particularly Liquid Staking Tokens (LSTs) and Liquid Restaking Tokens (LRTs).
RedStone creates customized price data sources specifically for new crypto assets, excelling in accurately pricing assets that traditional methods struggle with. For example, they’ve developed a slippage-weighted price discovery model that considers trading depth and liquidity factors, providing more accurate price assessments for tokens with limited liquidity. To ensure high levels of accuracy and relevance, RedStone continuously updates its modular pricing engine to adapt to the market’s ever-changing demands.
2. Full Chain Deployment Capability
RedStone’s price feeds are chain-agnostic, meaning they’re designed to operate independently of any specific blockchain. This enables RedStone to push data to multiple EVM and non-EVM ecosystems, scaling layers, and various application chains, making RedStone a partner for rollup-as-a-service providers and Eigenlayer actively validated services, offering compatibility and extended integration options.
3. Supporting Flexible Data Consumption Models
RedStone’s modular data consumption model has many uses. For example, Push Oracles actively provide data to smart contracts at predetermined intervals. RedStone’s oracle node operators or their authorized parties regularly push the latest price data to the blockchain without waiting for user or smart contract requests. This approach ensures the latest data is always available on-chain, but it also means that each update generates fuel fees regardless of whether the data is used. In contrast, Pull Oracles operate differently, providing data only when smart contracts issue query requests, ensuring data is only fetched when needed.
4. Highly Modular Design
RedStone’s system consists of multiple independent components that can be easily replaced or added to enhance efficiency, improving operational flexibility and optimization for specific use cases. The modular design also increases system reliability and allows for optimization for specific purposes, significantly improving fuel efficiency.
5. Supporting All DeFi Applications
RedStone’s modular architecture offers dApps multiple methods to access its data. All price feeds are stored off-chain in a decentralized and secure manner within the “Data Distribution Layer” (DDL) and are timely delivered on-chain according to specific oracle models. This setup enables various dApps across different chains to consume the same price feeds in multiple ways, meeting their specific requirements.
What Are the Use Cases for RED?
RED is a core component of the RedStone platform, carrying many important functions that enable the smooth operation of the entire RedStone ecosystem. So what exactly are the use cases for RED?
1. Staking for Economic Security
Staking for economic security is RED’s most important use case. For oracles to survive long-term and protect DeFi’s security, a sustainable token economic model is necessary. RED introduces the first truly sustainable oracle economic model through its value accrual mechanism. By leveraging RedStone’s EigenLayer Actively Validated Service (AVS), RED staking adds a powerful economic security layer to RedStone’s oracles, utilizing not only staked RED tokens but potentially also tapping into billions of dollars in staked funds within EigenLayer to provide additional security guarantees.
2. Staking by Data Providers and Token Holders
RED tokens can also be staked by two types of participants: data providers and token holders. Data providers supply data to RedStone’s modular oracle network, while token holders can stake directly in the RedStone AVS to enhance network security. Both staking methods offer participants opportunities to earn rewards, which will be paid in assets such as ETH, BTC, SOL, and USDC, creating a virtuous cycle.
3. Ecosystem Development
RED can also be used for developing the RedStone ecosystem. 48.3% of RED tokens are allocated to the RedStone ecosystem and community, used for numerous developments:
- It rewards early supporters and active participants to support community building and genesis activities
- Some funds are used through grants and incentives to support developers in building new applications and services, helping ecosystem growth
- Data providers will receive rewards, ensuring the network can continuously obtain high-quality, timely data
- Protocol development will also receive funding support for researching new technologies and improving existing systems
- These funds are also used in educational programs, helping more people understand and use RedStone
RedStone vs Chainlink vs Pyth
In the blockchain oracle market, there are three major players: RedStone, Chainlink, and Pyth. While all three companies provide oracle services, they have significant differences in functionality, architecture, and areas of focus. So what sets RedStone, Chainlink, and Pyth apart? Let’s compare them in detail across several aspects:
1. Architectural Design
- RedStone: Employs a modular oracle architecture, simultaneously supporting both Push and Pull data transmission models, accommodating any purpose, asset, and ecosystem
- Chainlink: Primarily uses the Push model to push data to blockchains, and provides a standardized interface allowing most developers to integrate and use its services in similar ways
- Pyth: Promotes the Pull model oracle, using Wormhole as a cross-chain relayer
2. Data Transmission Modes
- RedStone: Supports both Push and Pull models, and provides prototypes for future consumption models (such as ultra-low latency oracles)
- Chainlink: Primarily focuses on the Push model
- Pyth: Focuses on the Pull model
3. Ecosystem Support
- RedStone: Spans both EVM and non-EVM ecosystems, already deployed on more than 70 chains
- Chainlink: Mainly concentrated on a limited number of mature EVM chains
- Pyth: Conducts cross-chain integration through Wormhole
4. Growth Rate
- RedStone: Became the fastest-growing oracle in 2024, with user growth reaching 500%
- Chainlink: Has the longest market presence record
- Pyth: Observed accelerated growth in 2023
5. Security Record
- RedStone: Is the only major oracle that has not experienced mispricing events
- Chainlink: Has experienced 25% mispricing, resulting in protocol losses
- Pyth: Has experienced a data error where BTC flash-crashed to $5000
In the long-term development, blockchain and DeFi spaces need diversified oracles, so it’s crucial to focus on the overall growth of the DeFi ecosystem and the adoption of blockchain solutions.
With its modular design, RedStone is rapidly emerging as an important force driving innovation in blockchain oracles.
Does RedStone Have Future Potential?
RedStone achieved 500% user growth in 2024, becoming the fastest-growing oracle in the market. It currently serves over 130 clients across more than 70 blockchains. This rapid expansion indicates that market demand for its modular, cross-chain services is growing quickly. Looking at market trends, as blockchain ecosystems continue to develop in a multi-chain direction, RedStone’s flexible architectural design will become a competitive advantage.
Additionally, RedStone’s technological innovations show great development potential. On one hand, its unique off-chain data storage and on-demand retrieval model effectively solves the high-cost problems of traditional oracles; on the other hand, the flexibility of supporting both Push and Pull models enables it to adapt to the needs of different DeFi application scenarios. At the same time, the RED token will further enhance its economic security, ensuring the development of the ecosystem.
Of course, the oracle market is highly competitive. Chainlink, as the market leader, has first-mover advantages and numerous partnerships. Moreover, with technological advancement, new oracles may emerge to challenge RedStone’s market position. Furthermore, all cryptocurrency projects face regulatory risks and market volatility challenges.
Overall, based on RedStone’s technological innovation, growth rate, ability to solve practical problems, and the upcoming RED token, RedStone possesses strong future potential. If it can continue to maintain high-quality data services, strengthen cooperation with DeFi projects, while effectively managing its token economic model, RedStone is likely to become an important player in the future oracle space.
Conclusion
As an innovative modular oracle platform, RedStone is changing the DeFi ecosystem at an astonishing pace. Through its unique off-chain data storage solution, dual-model support, and cross-chain capabilities, RedStone has successfully addressed problems faced by traditional oracles such as high costs, lack of flexibility, and scalability limitations.
Compared to Chainlink and Pyth, RedStone demonstrates significant advantages in architectural design, data transmission modes, and security record. The upcoming RED token will further enhance the economic security and sustainability of the RedStone ecosystem.
Although the oracle market is highly competitive, based on RedStone’s technological innovation, rapid growth, and ability to solve practical problems, it has the potential to become an important player in the future oracle space. For investors seeking efficient, flexible oracles with economic scale, RedStone is undoubtedly one of the projects worth paying attention to.
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