Q ♣ · Coordination · Draft
Oracle
A service that brings outside facts, such as a price or an election result, onto the chain.
How it works
A smart contract cannot read the web, so it asks a reporter to fetch a fact and post it. In a simple design, one trusted party posts the value. In a stronger design, many independent reporters each submit, and the contract takes the middle value or the majority answer. Reporters often stake tokens and lose them if their answer is proven wrong. Anyone can dispute a posted value within a window, which sends it to a vote or a jury. Once final, the contract acts on the value: it pays out, settles a bet, or triggers a proposal.
Use it when
- You want a proposal or payout to depend on a real-world outcome.
- Settle prediction markets, insurance claims, or futarchy decisions with outside data.
- Price treasury assets on chain for swaps, loans, or buybacks.
Watch out for
- Whoever controls the data feed controls the contract; a wrong or manipulated price can drain a protocol.
- On subjective questions, the dispute voters, not the facts, may end up deciding the outcome.
Example
Chainlink. Chainlink has run decentralized price feeds since 2019; many reporters post prices and the middle value is used by lending protocols such as Aave to value collateral.