Lead

RedStone, a blockchain oracle network, was appointed the official oracle provider for Kraken’s Ink layer‑2 after a rapid emergency deployment during a security incident that halted Tydro, a key lending protocol on the network. The partnership, announced on May 15, will see RedStone support Tydro’s expanding markets and provide coverage across the wider Ink ecosystem as the layer‑2 scales to over $270 million in total value locked.

Background

Kraken launched its Ink layer‑2 in December 2024, initially holding less than $1 million in TVL. By early 2025 the network had grown to over $270 million, driven by exchange‑linked defi and Kraken’s large user base, according to DefiLlama. Ink aims to onboard more than 10 million exchange users into on‑chain finance, tokenised assets and new market categories, creating a growing need for resilient oracle infrastructure. Blockchain oracles act as bridges between smart contracts and off‑chain data, a function that has become foundational for DeFi, insurance, supply‑chain and enterprise applications. The global oracle market was $1.4 billion in 2024 and is projected to reach $10 billion by 2033, with a compound annual growth rate of 23.7% (Dataintelo).

What Happened

On May 4, Tydro paused all markets after its then‑oracle provider, Chaos Labs, suffered a sophisticated attack. No incorrect on‑chain pricing or user fund loss occurred, but the incident highlighted the need for stronger oracle resilience. RedStone was called in and, within 48 hours, had production‑ready price feeds running on Ink and cleared Tydro’s full security review. The rapid response secured a long‑term partnership. Under the agreement, RedStone will support Tydro’s new and expanding markets and provide oracle coverage across the wider Ink ecosystem, including lending protocols, risk infrastructure and Kraken‑native tokenised assets. In Tydro’s architecture, RedStone operates alongside Chainlink on core markets for price verification, while serving as the primary oracle for isolated and tokenised markets. Its Atom OEV product captures liquidation MEV, and a partnership with Credora enables institutional‑grade risk frameworks on‑chain.

Beyond Tydro, RedStone is expanding across Ink, integrating with Nado and Kraken‑native products such as xStocks. The protocol currently serves more than 200 applications with a track record of zero mispricing events. RedStone co‑founder Marcin Kazmierczak noted that the incident proved the importance of fast, secure infrastructure response and expressed excitement about powering Ink’s next phase of growth.

Market & Industry Implications

The swift onboarding of RedStone demonstrates the critical role of oracle agility in DeFi security. Kraken’s choice to partner with a provider that can deploy within 48 hours and maintain zero mispricing events may influence other layer‑2 networks to prioritize rapid response capabilities. The partnership also underscores the growing demand for oracle solutions that can handle both major crypto markets and newer asset categories requiring faster iteration and broader coverage. As the global oracle market expands, providers that combine speed, security and scalability—such as RedStone—are likely to capture a larger share of the $10 billion projected market by 2033.

For Tydro, the move to RedStone strengthens its ability to launch new markets and tokenised assets while maintaining robust price verification. The integration of Atom OEV and Credora’s risk frameworks positions Tydro to offer institutional‑grade services, potentially attracting larger liquidity providers and expanding its TVL beyond the current $205 million. Kraken’s broader strategy to onboard 10 million exchange users into on‑chain finance will be supported by a more resilient oracle layer, reducing the risk of future disruptions and enhancing user confidence.

What to Watch

  • Upcoming announcements from Kraken regarding the rollout of new tokenised assets and isolated markets on Ink, which will rely on RedStone’s oracle coverage.
  • Performance metrics and audit reports from RedStone’s Atom OEV product, particularly its handling of liquidation MEV.
  • Potential integration milestones with Nado and xStocks, which could signal further expansion of RedStone’s footprint within Ink.