The most common kind of oracle is software that aggregates data already available on the internet and feeds it to a Smart Contract, such as price data for cryptocurrencies. <\/p>\n\n\n\n
Some blockchain-based applications need to reference data from the physical world, which can only come through a piece of hardware such as a sensor or scanner. This could include data on weather, traffic or physical sales.<\/p>\n\n\n\n
Sometimes the source of data can only be provided via a human, who feeds the data into an oracle application and signs it cryptographically. An example could be in-game data from a low tier tennis match powering a betting dApp.<\/p>\n\n\n\n
Each type of oracle simply delivers data to a destination, but the manner and direction can vary.<\/p>\n\n\n\n
Input oracle<\/strong> – The most common type of oracle fetches off-chain data (from the outside world) and feeds it into blockchain applications.<\/p>\n\n\n\n Output oracle<\/strong> – In some cases, an oracle can push data in the other direction, from a blockchain (on-chain) to an external service. This could be because a Smart Contract has a function to trigger a bank payment when a certain condition is met.<\/p>\n\n\n\n Cross-chain oracle<\/strong>\u00a0– Though enabling blockchains to exchange data without the outside world is hugely important, the same is true of data sharing between blockchains.\u00a0Cross-chain\u00a0oracles enable this, though they face the difficulty of reconciling different consensus methods.<\/p>\n\n\n\n Computer Enabled<\/strong> – In some cases, an oracle can act as a random number generator for a Smart Contract with the outcome confirmed on-chain before the dApp uses it. A good example is a lottery draw where the oracle acts as a VRF – verified random function – the equivalent of the ball machine you might have seen in televised lottery draws.<\/p>\n\n\n\n Though there are many ways for oracles to access information and feed it into Smart Contracts, they risk becoming a single point of failure for blockchain applications and open up the potential for data manipulation. This challenge is known as the Oracle Problem and has no easy solution.<\/p>\n","protected":false},"excerpt":{"rendered":" Software oracles The most common kind of oracle is software that aggregates data already available on the internet and feeds it to a Smart Contract, such as price data for cryptocurrencies. Hardware Oracles Some blockchain-based applications need to reference data from the physical world, which can only come through a piece of hardware such as […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[588],"tags":[],"_links":{"self":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/posts\/8207"}],"collection":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/comments?post=8207"}],"version-history":[{"count":0,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/posts\/8207\/revisions"}],"wp:attachment":[{"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/media?parent=8207"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/categories?post=8207"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mudassirbackup.infinitycodestudio.com\/index.php\/wp-json\/wp\/v2\/tags?post=8207"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}