Traders can now take long positions on crude oil futures with sOIL or short them with iOIL
DeFi derivatives platform Synthetix has launched two synthetic crude oil tokens: sOIL, which provides exposure to long positions, and iOIL, an inverse synth that lets traders take short positions while enforcing capped profit and loss through upper and lower bounds.
Because oil price discovery occurs across many futures contracts with different expiries, creating a single reference price for a perpetual synth presented a challenge. To address this, Synthetix partnered with Chainlink. Chainlink’s decentralized oracle network aggregates raw price data from multiple futures contracts, enabling Synthetix to construct a non-expiring Crude Oil Index based on Intercontinental Exchange (ICE) Brent Crude futures.
Chainlink’s oracle technology has recently seen wider adoption. Recent announcements showed Chainlink being used to generate a spot price for Bitcoin Market Cap Dominance and to provide accurate pricing for digital assets on e-commerce platforms, highlighting the growing demand for reliable off-chain data feeds.
sOIL is now available to trade on the Synthetix exchange and through Kwenta, a derivatives trading dApp built on Synthetix. Traders can swap sOIL for any other synth with effectively zero slippage and access to deep virtual liquidity. Additionally, market participants can use sOIL to create binary options and trade expectations about the token’s future price.
In a public statement, Synthetix described the sOIL launch as a step toward making traditional markets accessible from decentralized finance. The Chainlink integration allows Synthetix to tap high-quality, aggregated market data and expand the range of synthetic assets offered on its platform.
The same approach can be extended to other commodities that trade in large futures markets—such as coffee, wheat, and platinum—allowing crypto-native traders to gain exposure to diverse real-world assets without leaving their cryptocurrency wallets. Synthetix is surveying its user base to prioritize which new assets to add as synths next.