Oracles

Quick take - Oracles, Nodes & DONs

Oracles are the entities that connect blockchains to real-world data and existing systems, and provide critical infrastructure for establishing a unified, interoperable Web3 ecosystem.

In depth

ORACLES

The core purpose of oracles is to derive truth about the validity of off-chain data, events, or computation and then relay the results on-chain.

“A blockchain oracle is secure middleware that facilitates communication between blockchains and any off-chain system, including data providers, web APIs, enterprise backends, cloud providers, IoT devices, e-signatures, payment systems, other blockchains, and more.” - (Source: What is the Blockchain Oracle Problem? (https://blog.chain.link/what-is-the-blockchain-oracle-problem/))

Oracles maintain a critical role in crypto infrastructure as a means of connecting smart contracts to off-chain data

" The true power of well-designed oracles is that they can generate definitive truth about external state in a tamper-proof and automated way and be customized according to users’ own trust assumptions, performance requirements, and budgets."

Oracles are the entities that connect blockchains to real-world data and existing systems, and provide critical infrastructure for establishing a unified, interoperable Web3 ecosystem.

Chainlink oracle networks not only feed financial market data on-chain to power DeFi applications, but they also provide a wide range of secure off-chain computations such as verifiable randomness and decentralized execution to enable dynamic NFTs and highly automated dApps. Moreover, with the development of the Cross-Chain Interoperability Protocol (CCIP), oracle networks will help enable the fast-growing ecosystem of different blockchains and layer-2 scaling solutions to securely communicate with one another.

REVIEW Architecture of a generalized oracle network Definitive truth—each smart contract application defines exactly how they will derive truth from the external world and what falls outside of those bounds. The network is heterogeneous—oracles perform specific jobs for applications but don’t operate as a unified monolithic network with cross-dependencies. Services are diverse—a limitless number of oracle services are possible for users, with nodes varying in the number and quality of jobs performed and revenue earned. Node requirements vary—each job has different requirements, which nodes compete for by differentiating themselves via distinct infrastructure, data access, reputation, etc.

Decentralized oracle networks (DONs) incorporate the same concept as blockchains of redundant computation by a diverse group of entities to generate tamper-resistance, availability, and correctness of services. REVIEW

Timeline

Chainlink Oracle Resources

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Timeline

Date	Media	Author	Title

Educational

Date	Media	Author	Title
N/A	Official Docs	Chainlink	What Is a Blockchain Oracle?
Mar 22	Article	Chainlink	The Ultimate Guide to Blockchain Oracle Security
21 Oct 21	Video	Chainlink	What Is a Blockchain Oracle? Brief explainer video.
06 Jun 21	Article	HackerNoon	The Strengths and Weaknesses of DeFi Price Oracles
27 Nov 20	Article	Smart Content	Chainlink: Low-Level Infrastructure for Inter-Oracle Competition
06 Mar 20	Article	Chainlink	The Future of Oracles: Fireside Discussion with Ari Juels, IC3 Co-Director and Distinguished Cornell Computer Science Professor
06 Mar 20	Video	Chainlink	Fireside Chat with Ari Juels and Sergey Nazarov - Connected Smart Contracts San Francisco