Truflation: On Demand Inflation Data Powered by Chainlink Oracles

Truflation is a data aggregation suite of APIs that allows users to fetch compilations of present and past rates in the US economy, including, but not limited to: inflation rates, price indexes, and other inflation categories such as food or housing.

The past data can be separated into the following time intervals: weekly, monthly, and yearly; to which the timezone for the data is set to UTC standards, and the data is benchmarked all the way to 2010.

Truflation's Mission Statement

The main issue that Truflation has set out to solve is the problem generated by the US Central bank (The FED). Many economists, statisticians, and investors have criticized the low CPI maintained throughout the years, believing that this was the cause of the price rise in certain goods and services.

There have been solutions proposed on how we can influence the CPI in a more effective and positive manner, however the main issue is that the FED’s incentive is to mislead the general public and use outdated data collection and visualization methods in general.

The methods used are more old school, which not only delays the data collecting process, but renders it as useless as the data is 2-years or older. This leads to the third and final issue, which is undoubtedly the biggest of the three. Many economists and researchers have been unable to provide a proper solution for inflation for a while now, as there is no access to the full raw data. There has never been a consensus due to the incomplete data that professionals have to make inferences about.

This is where Truflation proposes its solution. By utilizing blockchain technology, decentralized systems, and the world's vast data access in order to provide a solution to inflation.

“Truflation is the first true US inflation index based on the independent data sources and metrics created by developers and crypto investors for developers and the crypto community. (Truflation Website, 2022)”.

Applicability of Truflation to Decentralized Applications

This spring I joined a team of two other developers to code a product for the Chainlink Spring 2022 Hackathon. Our project is Haptic DAO and submission details and a demo may be found here.

The purpose of our project is to provide a decentralized application (Dapp) for those with disabilities to engage in DeFi. The application feature haptic feedback, voice commands, and audio playback. The initial focus group is for those who are visually impaired.

Truflation supplied our application with all the inflation data for our Haptic Truflation page. Truflation's decentralized APIs allow for visually impaired users to be provided with an easier means of learning about previous economic conditions and providing them with the ability to draw any conclusions/patterns from the data.

For example, housing inflation data is aggregated from vendors and sources such as Trulia and Zillow in order to deliver a live, up-to-date rate. In our Dapp, users were able to select a housing card to hear this information and are able to sync the data manually. Our application, however, also runs a Chainlink Keeper job to manually sync this data every so often.

Truflation Inflation Calculations

This portion will provide a quick overview of the important aspects of their inflation calculations. For a more detailed overview please see the Truflation whitepaper.

Consumer Price Index is an important factor that Truflation provides. The Consumer Price Index provides information regarding the average changes in prices that consumers pay for goods and services over time.

As per Micro and Macro Economic theory, the CPI can be calculated using the following formula:

“The CPI is used across the US to negotiate wages and calculate contracts, GDP, retirement income, social payouts, stock dividends, etc. (Truflation, 2022)”.

Closing Remarks

Truflation provides a ChainLink Oracle API which is available online and on-chain for every crypto product and project aiming towards fixing the problem brought about by inflation. The Truflation feed gives daily updates which drastically differs from the monthly updates provided by the government while also providing absolute honest and clear methodologies for their data and calculation processes.

This project has received a grant from Chainlink and will continue to develop more APIs as they work to aggregate different types of data. The community is certainly excited to see where this project goes.

Disclaimer: The author of this post was not paid to endorse Truflation or any other product. This piece is purely for information purposes and should not serve as investment advise. Always do your own research.