What are oracles used for?

Oracles are “black boxes” that feed automatic machines with data they cannot gather by themselves.

What is the purpose of oracles in crypto?

Unless alternatives are found, oracles are indispensable to fetching real-world data. Therefore, they are necessary for almost any DApps. Oracles are also utilized for blockchain interoperability.

What does oracle mean in blockchain?

The meaning of the word oracle is still ambiguous. It may refer to the data feed, the contract that aggregates the data, the agent that fetches the data, and the protocol that operates the data transfer.

Are oracles strictly necessary for real-world applications?

Luckily not. Protocols such as Uniswap do not require oracles and derive the price of tokens with a mathematical formula. In the future, more applications will be completely automated and thus freed of oracle dependencies.

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Giulio Caldarelli

Independent researcher affiliated with the University of Verona. He has a Ph.D. in Economics and Management and his main area of research concerns Blockchain Oracles and the Oracle Problem. He is currently investigating how the Oracle Problem affects different real-world applications and has written various articles and a book on this matter. Above academic research, he is devoted to teaching and spreading knowledge on Blockchain, DeFi, and of course Oracles.

Latest articles by Giulio Caldarelli

What Is a Blockchain Oracle? An Introductory Guide

5 mins Nov 30, 2022 2 years ago