Distributed Price Oracle Machine: Design, Implementation and Challenges

robot
Abstract generation in progress

Design and Implementation of a Distributed Price Oracle Machine System

To address the problem of single points of failure, some blockchain projects have adopted the design of distributed price Oracle Machines. For example, in a system that provides the Bitcoin to USD price service, 31 independent Oracle Machines are aggregated to serve users.

Oracle Machine Detailed Series: Chainlink (Part 2)

The contract source code of such aggregators can usually be viewed on blockchain explorers. By calling specific methods in the contract, all off-chain Oracle Machines contained within the aggregator can be viewed. Each off-chain Oracle Machine can provide price data in response to user requests in the aggregator by calling specific methods. These off-chain Oracle Machines are often externally owned accounts (EOA), which can provide data for not only one cryptocurrency price aggregator but also potentially serve multiple cryptocurrency price aggregators.

Oracle Machine Detailed Series: Chainlink (Part 2)

On-chain contracts undergo a series of strict verification steps when processing data provided by the Oracle Machine:

  1. First, read the current contract status and perform a series of checks.
  2. Carry out the necessary preparations after inspection.
  3. Use cryptographic algorithms to verify each signed data to ensure the authenticity and integrity of the data. At the same time, check whether the signer's role is legitimate and prevent the reuse of signatures.
  4. Finally, check the order of the observed values, select the median as the final result, and ensure that this result does not exceed the preset threshold.

Oracle Machine Detailed Series: Chainlink (Part 2)

Some systems also introduce additional verification mechanisms, such as comparing results with other price sources to ensure deviations are within acceptable limits.

To further simplify the usage process and reduce governance costs, some projects have introduced the concept of "Feed Registry." This can be understood as an aggregator of multiple price Oracles, allowing users to directly read the price data of various cryptocurrencies through it, without the need to set up each price Oracle individually.

Oracle Machine Detailed Series - Chainlink (Part 2)

In practice, price data is usually aggregated through multiple layers: data source aggregation, node operator aggregation, and Oracle Machine network aggregation. The raw data mainly comes from major trading platforms and is then initially processed by professional data aggregation service providers. Node operators obtain data from multiple independent data aggregation service providers and perform secondary aggregation. Finally, the entire Oracle Machine network performs final aggregation on all nodes' data, typically using the median method.

Oracle Machine Detailed Series: Chainlink (Part 2)

It is worth noting that not every data update will be immediately reflected on the blockchain. On-chain updates are triggered only when the price change exceeds a specific threshold or reaches a preset time interval. This mechanism, while ensuring the reliability of the data, also leads to a relatively slow price update speed, which can range from a few minutes to 24 hours. Therefore, such Oracle Machine systems are mainly suitable for application scenarios with low requirements for price update speed.

Oracle Machine Detailed Series on Chainlink (Part 2)

LINK4.61%
View Original
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
  • Reward
  • 5
  • Share
Comment
0/400
NFTRegretfulvip
· 07-16 08:55
Is the update slow and still not an issue?
View OriginalReply0
DisillusiionOraclevip
· 07-14 01:51
Where do so many Oracle Machines come from? One is enough for me.
View OriginalReply0
DataPickledFishvip
· 07-14 01:48
It's not that easy to verify, let's see who breaks down first.
View OriginalReply0
GamefiHarvestervip
· 07-14 01:46
It's not as fast as a double signature update, hehe.
View OriginalReply0
CoinBasedThinkingvip
· 07-14 01:33
Data accuracy is key.
View OriginalReply0
Trade Crypto Anywhere Anytime
qrCode
Scan to download Gate app
Community
English
  • 简体中文
  • English
  • Tiếng Việt
  • 繁體中文
  • Español
  • Русский
  • Français (Afrique)
  • Português (Portugal)
  • Bahasa Indonesia
  • 日本語
  • بالعربية
  • Українська
  • Português (Brasil)