Pyth Oracle Network Brings Industry Heavyweights Into Governance Post-Airdrop

The low-latency oracle network's new "strategic partners" include Castle Island Ventures, Multicoin Capital and Wintermute Ventures. They could play a major role in shaping how the platform evolves.

AccessTimeIconDec 5, 2023 at 3:00 p.m. UTC

Pyth, an oracle service that provides low-latency pricing data to blockchains, distributed its new PYTH governance tokens to more than 90,000 crypto wallets in November. The token was introduced as a way to decentralize Pyth's governance process – a system that will allow token-holders to vote on how the platform evolves.

As the result of a "strategic fundraising" round announced this week, some of the crypto industry's largest players – including some big-name venture firms and market makers – could soon have a loud voice in this new system. The Pyth Data Association, a Swiss non-profit focused on Pyth development, told CoinDesk this week that it has raised funds from crypto heavyweights including Castle Island Ventures, Multicoin Capital, Wintermute Ventures, Borderless Capital, CMT Digital, Bodhi Ventures, Distributed Global and Delphi Digital.

Michael Cahill, the CEO of Pyth developer Duoro Labs and a director of the Pyth Data Association, said in an interview that the new partners all received allotments of PYTH tokens – the assets that double as votes in the protocol's governance system. Cahill declined to specify how much money the Data Association had raised in the round, but the Data Association's new funders could potentially use their PYTH tokens to influence how the platform develops moving forward.

"This round expands the Pyth community to new stakeholders and individuals dedicated to advancing decentralized capital markets," the Pyth Data Association said in a statement. "New stakeholders will help the network grow through enhanced access to new capital sources, participation in governance and protocol improvements, and strategic guidance."

The Data Association's new partners are "excited about being able to shape the direction of Pyth and being able to drive this from a truly decentralized perspective," Cahill said in the interview.

Pyth, which launched on the Solana blockchain in 2021 and has since expanded to 45 blockchains, currently services 25% of all applications that use oracles, according to Cahill. Oracles are critical pieces of blockchain infrastructure that shepherd real-world data (in Pyth's case, price data for stocks, commodities and currencies – both fiat and the crypto kind) onto blockchains.

Unlike Chainlink, the current leader in oracles, Pyth sources its data directly from first-party financial firms (and many Pyth contributors rank among the biggest firms in trading) rather than third parties. This direct-from-the-source data gathering, combined with other elements of Pyth's architecture, is designed to give the protocol a leg up in terms of overall speed – a key differentiator that could help Pyth eat away at Chainlink's dominant market position, and could bring sluggish crypto markets further-in line with the demands of modern finance.

Pyth was incubated by Jump Crypto, the crypto arm of Jump, a major Chicago-based trading firm. It spun out into an independent entity mid-year with the establishment of Duoro Labs, which is currently exclusively focused on the development of the Pyth protocol, according to Cahill.


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Sam Kessler

Sam is CoinDesk's deputy managing editor for tech and protocols. He reports on decentralized technology, infrastructure and governance. He owns ETH and BTC.