Data Feed Configurations
When creating a data feed (oracle), customers can choose from several configuration options. The breakdown below is based on the data sources the feed uses.
Market Rate Data Feeds​
Market rate data feeds aggregate data from multiple sources, including onchain data from DEXs and offchain data from CEXs. This approach ensures real-time pricing but is also sensitive to market fluctuations.
Exchange Rate Data Feeds​
Also called Fundamental Data Feeds, Exchange Rate Data Feeds are computed based on the value of underlying assets. They provide stable reference rates but they may not always reflect real-time market fluctuations. These are most frequently associated with LSTs (Liquid Staked Tokens) and yield-earning token wrappers (e.g. ERC4626 tokens).
In other words, an exchange rate data feed indicates how much an asset is worth based on what the asset is backed by.
Hybrid Data Feed​
This type of data feed uses a combination of exchange and market rates.
For example, the WSTETH/USD data feed uses both market prices for WSTETH as well as the fundamental value of the unwrapping WSTETH to STETH along with STETH market prices.