Oracles (Units that connect blockchains to external networks/systems) have been struggling with the problem of off-chain data required for smart contracts. The missing or inaccurate information has created many problems in this sector. UMA came into existence and became a solution to these existing problems and several other ones.
In this blog post, we’ll talk about what UMA is and its features.
What Is UMA (UMA)?
UMA is an Optimistic Oracle and dispute arbitration solution that enables arbitrary data types to be delivered on-chain safely. UMA provides data for various projects, including custom derivatives, insurance protocols, prediction markets, and cross-chain bridges. UMA also produces a great variety of additional products and protocols.
The Optimistic Oracle provided by UMA makes it possible for contracts to seek and obtain price information rapidly. The Optimistic Oracle is a generalized escalation game between contracts initiating a pricing request and the Data Verification Mechanism (DVM), UMA's dispute resolution system.
Prices that the Optimistic Oracle suggests are only communicated to the DVM if they are challenged first. This makes it possible for contracts to receive pricing information within any period that has been provided without the need for an asset's price to be recorded on-chain. This makes it possible for contracts to get pricing information within any specific time frame.
A request is submitted to the DVM if there is a disagreement. The DVM operates as a dispute resolution backstop for all contracts developed on top of the UMA. Disputes submitted to the DVM will be resolved forty-eight hours after holders of UMA tokens have voted on the asset's price at a particular moment.
What Is a UMA Token?
The UMA security concept is based on an ERC-20 token called UMA, a cryptocurrency. As previously stated, token owners can participate in community voting on contested data. When UMA holders participate in voting, they are eligible for incentives. Every time a vote is on the network, active voters receive an inflationary reward equivalent to 0.05% of the total UMA in circulation.
Token holders have additional responsibilities, including participation in governance, protocol improvements, and system modifications.
The total supply of UMA tokens is 71.05 million. The total market cap is 187.09 million. Currently, it is trading at $2.621.
History of UMA
Hart Lambur was one of the co-founders of UMA in 2017. In December 2018, the white paper for the UMA project was made public. Shortly after that, the creators of the UMA project announced the formal launch of the project and launched the USStocks token as the first product that would run on the core network. In April of 2021, UMA conducted the initial offering of liquidity by a decentralized exchange on Uniswap. This offering was made as part of UMA's inaugural liquidity offering.
Feature of UMA
The OO from UMA offers a dispute resolution system for data between smart contracts that humans power. Unlike typical inflexible price-feed oracles that can only provide solitary, repeating values onto a blockchain, OOs offer a method to reconcile inaccurate or ambiguous data shared between smart contracts. Because OOs can offer any kind of knowable truth from off-chain, such as a sports score, weather conditions, or election results, they are more flexible than other types of oracles. This means the potential for such systems to be used in Web3 is limitless.
Universal Market Access, or UMA, aims to provide users with the resources, including tools and materials, necessary to create their own financial contracts and synthetic assets. The name of the organization suggests this goal. The UMA protocol, which allows users to tokenize contracts from traditional payment markets, is the primary instrument that may be used to diversify financial markets and reduce the barrier to entry.
A human-induced data dispute settlement between smart contracts through UMA's OO is available. In contrast to traditional price-feed oracles, which are rigid and can only supply a blockchain with a single value repeated multiple times, distributed ledgers use distributed ledger technology.
OOs offer a framework for balancing smart contracts despite the presence of partial or ambiguous data. They can provide any truth identified from off-chain, such as a weather report or polling numbers. Because OOs are more malleable than other oracles, there is a greater possibility that they will be used in Web3 applications.
UMA Token Value
The UMA token has fantastic applications. The UMA token is used to govern the UMA protocol in the following ways:
- Use DVM to cast your vote on pricing demands relating to financial contracts.
- Voting on parameter changes and approving system upgrades are two aspects of governance for the UMA ecosystem.
- Make money by providing data points to customers.
- Defend the Oracle from any attacks made by Sybil.
How to Buy UMA Tokens?
CoinEx is a global cryptocurrency exchange, trusted by 5+ millions of users worldwide with 100% reserve. With its 700+ tokens supported, including UMA, users can now trade easily and seamlessly.
Here’s how to buy via CoinEx:
If you already have a CoinEx account, this is how you can purchase and sell UMA on CoinEx:
- Enter your login information: To access your CoinEx account, visit the website or launch the app and enter your email and password.
- Put funds in your account to make UMA purchases. You can deposit the funds via credit card, etc.
- Once you have funds in your account, you may buy UMA coins by going to the UMA trading page and choosing the trading pair you wish to use.
- Tokens (USDT, BTC, ETH, and CET, etc.) can be exchanged for UMA. Put in your order and the quantity you want to buy.