BLOCKCHAIN ORACLES: BRINGING THE WORLD’S DATA TO BLOCKCHAINS
For many of the predicted use cases for Smart Contracts, it has been demonstrated that Oracles are essential. Oracles are able to provide the needed data input and outsource the need for processing power since they have the capability to link the Blockchain to the outside world.
In response to a direct question to the gods, humans in ancient folklore consulted oracles to get prophecies or transcendent insights.
In this manner, decisions done in the terrestrial realms may be explained as being in line with greater power. Every advanced society around the globe, on practically every continent, used oracles.
They usually involved a medium, someone who could communicate with the gods directly or the performance of a rite in which the results would reveal the gods’ opinions.
Although they deny having communication with supernatural beings, oracles in the context of the Blockchain do connect otherwise disparate domains. They serve as a bridge connecting a Blockchain to the outer world.
THE NEED FOR BLOCKCHAIN ORACLES
Blockchain Oracles are crucial for many because they give Smart Contracts the capacity to access data from sources other than the Blockchain.
Even while the concept of autonomous entities on the Blockchain is truly innovative, their technological design presents a number of challenges: Data that is kept on the Blockchain is the only data that smart contracts may access. Additionally, it is quite costly to do huge data calculations.
Being a self-contained peer-to-peer network, the Blockchain is theoretically unable to access any data outside of the decentralized ledger. So, the only data that Smart Contracts may access is data that is stored on the Blockchain itself.
A Blockchain, however, is now unable to handle such an amount of data. Therefore, Smart Contracts by themselves would not offer enough processing power.
The issues with smart contracts mentioned above can be resolved by including oracles into them. Oracles can link an external data stream to the Blockchain. This enables Smart Contract apps to respond to happenings in the real world. In this manner, almost anything may be established as a prerequisite for the execution of a smart contract.
UMBRELLA NETWORK: A COMMUNITY-OWNED ORACLE
The first wholly decentralized, community-owned, and incredibly scalable Oracle solution — Umbrella Network addresses the scalability issues in Blockchain oracles and makes use of the Delegated Proof of Stake consensus mechanism to deliver a speedy and thorough data feed of over 1200 data points covering mid and long-tail crypto assets in addition to additional financial data, and it is dispersed throughout several places.
Umbrella Network stores and transmits Layer-2 data using Merkle Trees. Each leaf node on a Merkle tree stands in for a single data point and is rolled up to the root hash. The Proof of Stake also includes the root hash, which represents all of the Merkle Tree’s data points.
The Umbrella team believes that building a community-owned oracle is necessary to achieving a completely decentralized financial system. As a result, the Umbrella team has given its community control over the protocol so they may build a network that is not just resilient to attacks but also long-lasting and lucrative.
Find out more about the Umbrella Network via the following links: