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/biz/ - Business & Finance

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53256947 No.53256947 [Reply] [Original]

What is an oracle and why is it important?

>> No.53256987

Do you know what a smartcontract is or do i have to start with the basics?

>> No.53257058

>>53256987
financial programs running on a decentralized crypto network?

>> No.53257138

Hello you still there op? I wont answer if you already left

>> No.53257178

>>53256947
Who are these two? Clockwerk and Rubick?

>> No.53257200

>>53257178
No, Smart contracts and Oracles. Keep up.

>> No.53257203

>>53256947
fundamentally its the foundation for the future of financing

>> No.53257224

lets say you have a smart contract for a loan, and when the price of the asset in collateral goes below a set price the smart contract executes and takes your collateral. standard practice on platforms like aave, a simple collaterised loan.

but not so simple. because where do you get the price from? someone has to upload a price feed to the blockchain. well thats a centralized point of failure if that someone fudges the data they could fake the price of the asset and liquidate your loan. you'd have to trust them not to, we're not very trusting in crypto since not having to trust is really the entire point of all crypto.

so you take another blockchain, an oracle. and this is a way where instead of one person uploading the price feed the entire network does. now instead of only a single entity being able to fudge the data with a single computer, you'd instead have to corrupt the entire network and have the nodes confirm the false numbers and to do that you'd need to control over half the network and nobody does.

if i'm understanding correctly. and this loan example is one of many there are other applications for this concept.

>> No.53257247

>>53257138
I'm still here mate, on my phone now though

>> No.53257263

>>53257224
Ah, okay
But no one's using smart contracts for loans.
Why are smart contracts so important?

>> No.53257281
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53257281

>>53257138
I'd be quite interested to have a refresher on the subject, if you have the wherewithall.

>> No.53257290

>>53257263
using smart contracts for loans is the biggest part of defi and a lot of people are using it. how did you think decentralized loans worked?

>> No.53257319

>>53257290
I don't know lol
Are people really using defi or is it just another crypto moonboy thing

No one uses defi outside of /biz/ and crypto subreddits

>> No.53257335

>>53257224
Those already exist. They're called API aggregators.

>> No.53257375

>>53257319
you must think we're fucking rich. biz and crypto subreddits wielding 200 billion dollars between us. impressive

>> No.53257415

fuck bros... i miss old LoL and the oldfag /v/ generals

>> No.53257498

Speaking of which, is there an estimate on how much money has been made unaccessible due to poorly implemented contracts?

>> No.53257515

Sorry didnt see your answer op.
So a smartcontract is a contract that is decentralized on a blockchain and executes automatically. It will be the most important thing in the global economy.

>> No.53257548

>>53256947
it's just a fancy name given to a mundane implementation step to make retail buy worthless tokens. are you copying a file into a directory or are you "implementing a snapshot management system"?

>> No.53257565

As op said, the entire point of your sc is to be trustless, but if you have to trust one data source for you sc, it undermines the purpose. This is why you need oracles = decentralised information

>> No.53257611

>>53257565
>>53257548
are you writing server software and hosting nodes to calculate a median or are you "implementing an oracle network"?

>> No.53257615

However, most people think it is only price feeds. This is incorrect, any of chain/real world data can be transported to the blockchain

>> No.53257616

>>53257335
and whose computer are you running this api aggregator on? who are you trusting?

yes a more centralized version of this already exists. a more centralized version of loans and banking and finance and money already exists. and its objectively inferior to the crypto alternative where you don't have to place faith in trusted parties not to mess about with the data they store on their computers. blockchains will become the easiest, least sloppy, most secure, and most trustless way to do all kinds of things we used to have to do by placing trust in central parties because we didn't have the tech to do it any other way.

the whole modern world runs on ledgers. it has since the days of clay tablets. these ledgers that run everything are very important. finances, logistics, etc. it's how we keep track and agree on what is what. but the system can be and is abused by people who lie, manipulate numbers, alter records, hack computers, etc. it's not very secure. a centralized system is all your eggs in one basket. a decentralized system is a thousand baskets and you have to break all of them to even break one.

>> No.53257718

>>53256947
an oracle is a smart contract that publishes data on-chain needed for the execution of certain smart contracts.

>> No.53257798

It just killed most of my text because captcha wrong
SCs combined with oracles will replace millions of wagies in administration and create a trustless economy

>> No.53257881

>>53257178
>>53257200
Kek

>> No.53258194

>>53257616
LOL

Where do you think the nodes that run the compiled byte code are hosted on? The EVM isn't some magical technology, it's literally just the JVM. Infura had a stranglehold on ETH nodes for years and many "decentralized applications" go down when AWS has outages. There are no trustless decentralized applications. They are bottlenecked by servers or ISP's. We saw this when Metamask "accidentally" geobanned millions of people.

As far as oracles go there has already been multiple failures. Not to mention the data they aggregate is open to attacks and errors.

>> No.53258757
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53258757

>>53257224
Excellent explanation. Thank you for dropping clearly explained, actual information.

You look good, King.