Curated Resource ( ? )

Oracles: The Invisible Backbone Of DeFi And Applied Blockchain Apps

Oracles: The Invisible Backbone Of DeFi And Applied Blockchain Apps

my notes ( ? )

the vast majority of defi apps rely heavily on oracles, middleware entities that connect smart contracts to resources outside of their native blockchains. Without oracles, blockchains are like computers without internet access... Often referred to as hybrid smart contracts ... [oracles enable] smart contracts that can react to real-world events and integrate with established business processes"... as well as providing a filtration system to verify trustworthiness of the data it's inputting into the smart contract.

On Ethereum, oracles transactions compete with everything else so the gas fees can go high - strange, given "oracle providers are actually contributing to the network".

Chainlink is "the most widely used decentralized oracle network (DON)... aggregate multiple external price feeds and provide medianized reference prices ... over $40 billion worth of smart contract value secured by its network."

Providing data aggregated from "off-chain sources... and delivering it on-chain to be consumed by smart contracts ... oracles can function as autonomous auditors, monitoring for fraudulent activity in real-time... Without the external financial market data that oracles provide, you can’t really build defi".

Read the Full Post

The above notes were curated from the full post www.forbes.com/sites/lawrencewintermeyer/2021/10/14/cryptohacks-oraclesthe-invisible-backbone-of-defi-and-applied-blockchain-apps/?sh=5d02e11b182d.

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