Before we delve into the current state of decentralized oracles, it's worth recapping what decentralized oracles are and why they're so critical to the blockchain space.
The blockchain industry is currently facing the same interoperability challenges as the information technology industry did decades ago. Due to the inability of networks to communicate with one another, there is ample opportunity for a poor user experience and inefficiency. Blockchains cannot interact with the physical world, at least not directly, because they are not connected to legacy systems. This constrains their usability and adoption significantly.
These constraints are frequently referred to as the Oracle Issue. Because there is no way to send or receive data from external systems built outside of blockchains, digital ledgers remain isolated, much like a computer without an internet connection. Given that the majority of smart contract use cases require interaction with the physical world, the Oracle issue is far more serious than anyone can imagine. Decentralized oracles have been developed as a solution to this problem by blockchain developers.
As a result, in response to the question, "What are Decentralized Oracles?" Decentralized oracles enable the integration of data from multiple sources. Technically, data from multiple data sources can be integrated by Oracle or by a third party.
Oracles that are not centralized Chainlink in 2021
Chainlink is without a doubt one of the most well-known decentralized oracle providers. Chainlink is a multi-chain oracle network that "provides smart contract developers with reliable, tamper-proof inputs and outputs." By market capitalization, Chainlink is the most comprehensive tokenized oracle solution and one of the most established in the blockchain space. Sergey Nazarov founded the company in 2017.
Chainlink's decentralized oracle network connects smart contracts to a wide variety of real-world data feeds, including asset prices, price feeds, sports data, shipping data, and weather data. Their solution is applicable to any blockchain and is currently being used by a number of leading Defi protocols, including Aave, Kyber Network, Synthetix, and Ampleforth.
Band Protocol is a cross-chain oracle network that enables decentralized applications (dApps) to integrate price and event feeds, connecting the decentralized and real worlds effectively. Band, despite being a year younger than Chainlink, has garnered considerable attention since its 2018 launch and is widely regarded as the most serious competitor.
The band provides "community-curated" data sources that enable dApp operators to contribute to the management and curation of data feeds, thereby resolving the oracle problem and providing smart contracts with reliable data feeds. The band is distinguished from Chainlink in this regard, as it enables decentralized applications to access data via smart contract data points rather than external oracles.
Band's integration with Google Cloud is a recent accomplishment. Band Protocol has been integrated into Google Cloud Public Data to enable the analysis of financial time series data in real-time and with high accuracy. Traditional, hybrid blockchain and cloud applications can be built to leverage unique data feeds from decentralized oracle services, such as Band Protocol oracle data that is currently available on Google Cloud Public Data. For additional information, please see the full article here.
The asset of Decentralized Information (DIA)
DIA is an open-source oracle platform that enables market participants to source, provide, and share trustworthy data. It is a Swiss not-for-profit organization that acts as an Oracle platform for the Defi ecosystem. It is essentially a platform that enables access to crowd-verified financial data, thereby facilitating the establishment of a fair and symmetrical financial ecosystem. Its mission is to provide transparent, secure, and verified market data.
API3 is a DAO-governed project that develops dAPIs (application programming interfaces) for DAPPs. It will deploy, manage, insure, and monetize large amounts of infrastructure. It is essentially a project to develop a new, more traditional method of connecting blockchains to the APIs of data providers. dAPIs are decentralized, blockchain-native API services that are created by combining multiple operators and running Oracle nodes without the use of an intermediary.
Witnet is a decentralized oracle network based on reputation: nodes running the Witnet software earn or lose reputation when they correctly or incorrectly fulfill a data request, with correctness defined by a consensus algorithm that analyses node responses. Nodes that violate the consensus lose reputation (by going offline or attempting to be malicious), which is then distributed among the honest nodes. If the consensus is a timeout, it is unpunished as long as at least one node agrees with it.
The Witnet protocol randomly selects Oracles, also known as "witnesses," to mine and fulfill data requests based on their reputation score. Beneficial oracles will earn more reputation points and will be more likely to be selected for tasks that reward them with tokens upon completion.
The Provable blockchain establishes oracles for DApps, enabling the decentralization of traditional financial, gambling, and insurance services. The procedure is as follows: the user identifies a critical process they wish to secure. After that, it's garbage in, garbage out; some applications cannot take that risk. Following that, Provable assists you in integrating their technology to ensure the correct equation is used in your process and to make it more transparent.
Finally, a comprehensive audit trail is provided to you and your clients during the execution of your critical process. Anyone can easily monitor its proper execution.
You can use real-time market data on these platforms with Finage free API key.
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