Key Insights
- Chronicle Protocol recorded 74,900 oracle price updates in Q3 2024, marking a 296% increase QoQ.
- Chronicle’s TVS decreased 12% QoQ, from $9.33 billion in Q2 to $8.21 billion in Q3, primarily due to the decline in the value of the assets secured.
- Operating costs via gas fees paid in USD per Chronicle oracle update decreased by 24.6% and 84.4% QoQ on Ethereum and Layer-2s, respectively.
- Using the respective ETH/USD oracle as a proxy, Chronicle updates on Ethereum were 73% more computationally efficient than Chainlink updates.
- Chronicle launched its Verified Asset Oracle (VAO) and partnered with Coinbase, Circle, Reserve, Re7, Steakhouse Financial, Euler, Badger DAO, Dolomite, M^0, Gnosis Pay, and Centrifuge.
Primer
Chronicle Protocol is an oracle network that aims to provide transparent, verifiable, and cost-efficient price feed oracles to blockchains. Chronicle currently secures $11.5 billion in assets on DeFi protocols and has supported Sky Protocol (formerly Maker) and its ecosystem since 2017.
Chronicle evolved from the Oracles Core Unit at Maker, established by Niklas Kunkel and Mariano Conti. Together, they co-developed Ethereum’s first onchain oracle in 2017 to facilitate SAI, the predecessor to the USD-pegged DAI stablecoin and the current USDS stablecoin. Chronicle began expanding beyond the Sky ecosystem in September 2023.
Chronicle developed Scribe, a gas-efficient oracle based on aggregated Schnorr signatures, introducing a new approach to oracle network architecture. Unlike competitors that rely on trust-based systems, Chronicle is trustless, ensuring full transparency through end-to-end verifiability, enabling every data point to be traced back to its original source queries. For a complete primer on Chronicle, refer to our Initiation of Coverage report.
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Key Metrics
Performance Analysis
Total Value Secured
Total value secured (TVS) represents the cumulative value of assets secured by an oracle network, including borrows. Since launching its public oracle product in September 2023, Chronicle’s average daily TVS increased 44.3% year-over-year (YoY), from $5.69 billion in Q3 2023 to $8.21 billion in Q3 2024. However, Chronicle’s average daily TVS decreased 12% quarter-over-quarter (QoQ), from $9.33 billion in Q2 2024 to $8.21 billion in Q3 2024, primarily due to the decline in value of the assets secured. For example, total value locked (TVL) in Sky (Maker) and Spark dropped 20.9% and 23.2% QoQ, respectively. Historically, Chronicle’s TVS has been predominantly composed of Sky, with TVS peaking at just over $20 billion in December 2021. Since Chronicle began offering its oracles to the public, Sky’s dominance decreased to 59.4% by the end of Q3, while Spark’s share increased to 31.7%.
Currently, DefiLlama only tracks the six protocols where Chronicle supports the majority of price feeds: Sky, Spark, M^0, Euler, Dolomite, and Keep Network. However, in total, Chronicle supports 23 protocols.
Chronicle remains among the top three oracles by TVS, with a market share gap of 31.8 percentage points behind leader Chainlink and 0.5 points behind WINkLink. Chronicle’s TVS dominance among the top 15 oracles by TVS decreased by 21.9% QoQ, from 17.8% in Q2 2024 to 13.9% in Q3 2024. The decline in dominance reflects heightened competition and the growth of markets on protocols like Solana and Pendle. This new market share in the last quarter was absorbed by Pyth, which increased 34.6% QoQ to 9.4%; Switchboard, which increased 51.7% QoQ to 4.4%; and other oracles, which collectively increased 16.6% QoQ to 12.4%.
Oracles
Oracles are onchain relays that provide blockchains with access to offchain data, such as real-time prices. Data models define the logic of how an oracle operates. For example, when Chronicle creates an oracle for a new asset, it curates a data model using various data sources and employs a data aggregation methodology to produce a final value for the specific oracle. This allows Chronicle to deploy any existing data model to a supported chain.
In Q3, Chronicle deployed 15 new oracles, increasing its total to 90, a 20% QoQ increase from 75 oracles. Additionally, Chronicle expanded its data model set to 47, increasing the catalog of data models that can be deployed as oracles on any supported blockchain.
Oracle Price Updates
Oracle price updates refer to the process where the oracle network retrieves the latest market price of a specific asset and records the price onchain. Unique price updaters refer to distinct validators or nodes tasked with fetching the latest price data.
In Q3, Chronicle recorded 74,900 oracle price updates, marking a 296% increase from the 18,900 updates in Q2. Of these, 71,100 updates were recorded on Ethereum Layer-2s (L2s), while only 3,800 were on Ethereum. This surge in updates can be largely attributed to an expansion of partnerships, including the integration of Base in June, the launch of Circle’s EURC/USD price feed in August, and the launch of Base’s cbBTC/USD price feed in September. The number of unique price updaters grew to 8,000, a 74.3% QoQ increase from 4,600.
Signers
Signers are validators that run a node within decentralized oracle networks and are responsible for gathering raw data and submitting it to the protocol. Signers attach a digital signature to the data, allowing the protocol to verify its authenticity and the specific validator that submitted it. Only a predefined number of validators are required to act as signers for each oracle transaction. The number of signers is directly related to the security of the oracle price feed: a higher number of signers strengthens security by making it more difficult for colluding validators to manipulate reported values. Successfully manipulating oracle-reported values can result in the theft of TVL from protocols that rely on them.
In Q3, Chainlink averaged 7 signers on Ethereum. On L2s, such as Base, Optimism, and Arbitrum, Chainlink averaged 4 signers. The number of signers on Chainlink oracles has not changed since Q2.
In mid-August, Chronicle began supporting 14 signers per oracle update on Ethereum and L2s, up from 7 signers in Q2. The seven additional signers directly improved Chronicle’s price feed security, resulting in a 100% higher threshold for oracle price feed manipulation compared to Chainlink on Ethereum, and a 250% higher threshold on L2s.
Gas and Fees
Gas Usage
Chronicle Labs utilizes Scribe, a gas-efficient oracle based on aggregated Schnorr signatures, which reduces the gas costs of oracle updates by over 60% on L1 and over 68% on L2 blockchains. On Ethereum, ETH transfers require 21,000 gas units, ERC-20 transfers require 65,000 gas units, and a swap on Uniswap requires 184,000 gas units. In Q3, Chronicle updates used, on average, 85,000 gas units on Ethereum, a 17.8% QoQ increase. On L2s, Chronicle updates used, on average, 119,000 gas units, an 8.1% QoQ increase.
Fees
Oracle update fees are not revenue generated by Chronicle but rather represent gas fees paid by Chronicle to update oracles with the latest values. Since gas fees are considered an operating expense and are often passed on to customers by oracle providers, efforts are focused on minimizing these costs over time.
In Q3, the average fee per oracle update on Ethereum cost $2.66, a 24.6% decrease QoQ. On L2s, average fees cost $0.01, an 84.4% decrease QoQ. Although the computational effort (gas units) for updating Chronicle oracles on Ethereum increased by 17.8%, the fees per oracle update on Ethereum and L2s decreased due to a 24.2% decline in ETH’s price. In Q3, Chronicle paid $10,200 in total fees on Ethereum and $665 on L2s, reflecting decreases of 10.6% and 9.23% QoQ, respectively.
Chainlink Comparison
Using Chronicle’s and Chainlink’s respective ETH/USD oracles as a proxy, Chronicle updates outperformed Chainlink updates in computational efficiency and fees. On average, in Q3, Chronicle’s ETH/USD oracle used 87,000 gas units at $3.51 per update. Compared to Chainlink’s ETH/USD oracle, which used 327,000 gas units at $11.83 per update, Chronicle’s oracle was 73.3% more computationally efficient and 70.3% less expensive.
Qualitative Analysis
Oracle Integrations
During Q3 2024, Chronicle Labs expanded its integrations with various applications, beginning the quarter with 18 integrated apps and ending with 23, a 27.8% QoQ increase.
BadgerDAO and Lido
On July 25, BadgerDAO integrated Chronicle’s oracles to support the eBTC Protocol. Created by BadgerDAO and Lido, eBTC is a Bitcoin-pegged asset that allows users to borrow BTC directly on Ethereum. Chronicle supports Badger with a stETH/BTC price feed oracle on Ethereum.
Circle
On August 1, Circle selected Chronicle as its oracle launch partner to deploy the EURC token on Base. EURC is an overcollateralized, euro-backed stablecoin. Builders on Base can access the EURC/USD price feed oracle.
Reserve, Re7, Steakhouse Financial, and Morpho
On August 7, Reserve and Re7 selected Chronicle to secure their hyUSD/eUSD market on Base via Morpho. This market will use Chronicle’s hyUSD/USD price feed oracle to deliver real-time price updates. Steakhouse Financial, a DeFi advisory platform, also selected Chronicle to provide price feed oracles to secure its Steakhouse USDM vault on Morpho Vaults. Morpho is a permissionless and non-custodial lending protocol that enables anyone to deploy lending markets.
Dolomite
On August 12, Dolomite, a DeFi lending platform, integrated Chronicle’s oracles to provide real-time price feeds for a variety of assets on Mantle, including ETH, mETH, MNT, USDT, USDY, wBTC, and more. Dolomite also integrated a wUSDM/USD price feed, enabling the use of Mountain Protocol’s USDM as collateral on Arbitrum.
Euler V2
On September 4, Euler selected Chronicle to secure multiple markets on Euler V2, including ETH, MKR, and stETH. Additionally, Chronicle’s Verified Asset Oracle can be integrated to support the creation of vaults for ‘real-world assets’ (‘RWA’) and crypto-native assets.
Coinbase
On September 12, Coinbase selected Chronicle as their oracle launch partner to support Coinbase Wrapped BTC (cbBTC) with a price feed. Existing DeFi protocols and builders on Base and Ethereum can access the cbBTC/USDC price feed oracle.
Other integrations during Q3 2024 include HMX, JOJO, and Term Finance.
‘RWA’ Integrations
Verified Asset Oracle and M^0
In August 2024, Chronicle partnered with M^0 to launch its Verified Asset Oracle (VAO) to verify T-Bill collateral on the M^0 protocol. The VAO is an ‘RWA’ oracle that can verify the integrity and quality of any offchain asset (e.g., Treasury Bills, fiat currency, and gold), transport the resulting data onchain, and distribute it directly to smart contracts or onchain products. M^0 is an overcollateralized stablecoin minting protocol that enables approved entities to mint a fungible stablecoin, M, using short-term U.S. Treasury Bills as collateral.
Gnosis Pay
Later in August, Chronicle integrated its VAO into Gnosis Pay to directly support GBP. Gnosis Pay is an onchain spending account with a Visa debit card linked to a self-custodial blockchain wallet.
Centrifuge
In September, Chronicle announced its partnership with Centrifuge, an onchain tokenized ‘RWA’ platform, to enhance the transparency of the Anemoy Liquid Treasury Fund (LTF). By integrating Chronicle’s VAO, Centrifuge provides real-time price updates and third-party verification for the LTF.
Validator Expansion
In Q3, Chronicle expanded its decentralized oracle network by onboarding four new validators — Nethermind, ETHGlobal, Euler, and Mantle — enhancing the protocol’s security and resilience. With this addition, the network is comprised of 21 validators, including Sky, Infura, Gitcoin, dYdX, Etherscan, Gnosis, and others.
By utilizing only projects that Chronicle defines as “reputable,” Chronicle believes it creates a unique and additional layer of security against a 51% attack by the validator set—a vulnerability to which all decentralized oracle networks are susceptible.
Chronicle Points and CLE Token
In September, Chronicle introduced Chronicle Points, its first community initiative to reward eligible participants with future CLE tokens. Participants can earn points by supplying USDS through Sky and Summer.fi, or depositing stablecoins on Spark. Chronicle plans to expand earning opportunities via its dashboard.
As of November 22, 2024, a total of 16.98 million USDS is locked and earning Chronicle Points on Sky. Additionally, Spark has a TVL of $16.99 million, with 670.7 million Chronicle Points rewarded to date.
Chronicle Points will eventually be redeemable for CLE tokens at a conversion rate of 10 points per 1 CLE token. The total supply of CLE tokens is set at 10 billion, with Chronicle Points being issued at an annual rate of 3.75 billion.
Closing Summary
In Q3 2024, Chronicle Protocol recorded 74,900 oracle price updates — a 296% increase QoQ — driven mainly by activity on Ethereum L2 networks. Despite a 12% decrease in TVS to $8.21 billion, the protocol remained among the top three oracle providers by TVS. Security was enhanced with the increase in signers per oracle update from 7 to 14, raising the threshold for potential manipulation. Utilizing its Scribe technology, Chronicle was 73% more computationally efficient than Chainlink and reduced fees for oracle updates on Ethereum and L2s.
During Q3, the ecosystem expanded as Chronicle partnered with Coinbase, Circle, Reserve, Re7, Steakhouse Financial, Euler, BadgerDAO, and Dolomite. Chronicle also entered the ‘RWA’ space by launching the Verified Asset Oracle (VAO) and partnering with M^0, Gnosis Pay, and Centrifuge. The validator network grew to 21 with the addition of Nethermind, ETHGlobal, Euler, and Mantle. Additionally, the protocol introduced Chronicle Points, a community rewards initiative linked to future CLE tokens. Moving forward, Chronicle aims to enhance network security further, expand its validator set, and integrate with more applications and real-world asset platforms.
