October 5, 2021 · 5 min read
Emerging Token - Umbrella Network
Umbrella Network is a community-owned Layer 2 oracle for DeFi.
Oracles are a key piece of DeFi as they enable smart contracts to access real world data that isn’t on the blockchain. Umbrella Network does not limit its data sources to crypto data but opens the blockchain to the mid and long tail crypto assets, volatility data and real world financial data such as OIL and NASDAQ.
Founded by Sam Kim, who has previously served as CEO of a blockchain ad-tech company Lucidity, Umbrella Network aims to power next-gen DeFi applications. Investors include Monday Capital, Moonwhale capital, Kyros Ventures and more.
Umbrella Network achieves scalability by adopting layer 2 technologies that leverage Merkle Tree. This enables multiple data points to be written in a single on-chain transaction. The most commonly used data pairs will always be available on chain and the rest will be living on Layer 2 Data anchored to Layer 1. Umbrella Network currently supports 961 data pairs on Layer 2.
Umbrella Network’s competitors include Chainlink, Tellor, DIA and Band Protocol with Chainlink leading the market. Here, Umbrella Network Layer 2 architecture stands out.
Source: Umbrella Network Litepaper
Umbrella Network employs a Delegated Proof of Stake(DPoS) consensus mechanism to ensure the active participation of the UMB token holders. The network’s native token UMB thus allows users to select validator nodes, participate in community votes, stake tokens and get rewarded accordingly.
60% of the token supply is distributed to the community, more than half of that (33% of the total token supply) is allocated to reward UMB stakers.
75% of the user fees paid will go to the Validators that vote with the majority. Token holders who participated in those Validator Pools will receive their portion of user fees on a pro rata basis.
Umbrella Network gives stakers rewards. rUMB, Umbrella reward token, on a 1:1 ratio. The rewards are unlocked when key business milestones are achieved, or on a specific timeline. Learn more about their milestones here. Umbrella Network officially launched on Ethereum Mainnet with a cross-chain bridge to BSC.
Umbrella Network has partnered with a Security Token and tokenized stocks AMM protocol IX Swap and a BSC-based stablecoin and lending DeFi protocol Fortress Finance. Umbrella Network will be providing frequently updated price feeds for them. Some of the early partnerships include a crypto payment platform 8PAY, a leveraged trading platform WOWswap, a staking and stablecoin provider OIN Finance.
Umbrella Network has recently acquired Lucidity to make a first foray into the enterprise market. Lucidity’s clients include KFC, Samsung and Hyundai. To find more information about the deal watch this video. The company’s partnership with IX Swap will also include decentralized oracles’ use for the traditional financial ecosystem.
Under the aegis of this partnership, Umbrella Network’s decentralized oracles will provide real-world asset data to IX Swap’s Liquidity Pools and AMMs. This may include stock prices, S&P 500 indices, Options data, and more. Umbrella Network’s partnership with IX Swap also shows the company’s vision to serve “real-world” markets. They will explore the custom data feed for private asset data of unlisted companies that could be useful for example, in cross-border M&As and IX Swap will work together towards the development of a custom data feed for private asset data.
The current price of UMB is $0.51, up by 113.5% compared to 30 days ago. There are currently more than 8000 addresses holding UMB on Ethereum and 3350 addresses on BSC. UMB market cap today stands at $43.2M with a circulating supply of 85.7M tokens. The current RSI (Relative Strength Index) value stands at 51, and it went up as high as 80 two weeks ago. Considering the fact that UMB increased by 130% in the past two weeks, the current RSI value of 51 does not indicate UMB as an overbought cryptocurrency. You can buy UMB on Gate.io, KuCoin, Uniswap, Pancakeswap, Sushiswap and more.
Umbrella Network’s strong community driven governance design and its integration of diverse real-world data makes UMB a project to watch.
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