Steemit Crypto Academy Contest / S8W4 - Blockchain Oracles

Assalam-o-Alaikum

Hello everyone I hope you are all ok and enjoy the good life by the grace of Allah Almighty I am here for participate in the amazing engagement challenge which organised by the Steemit CryptoAcademy the name of this challenge is Blockchain Oracles so let's start;

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Do you know what Blockchain Oracles are? We want to know your opinion.

Blockchain oracles are the entities that build the connection with of blockchain with outside body.They enabled the smart contracts to acess and connect the data from the real world to the blockchain world. The working of these smart contracts is based on the input and outputs generated in the real world. So Blockchain oracles are basically act as a bridge between the blockchain and real world.

Oracles gives us the method or way to provide a vast Decentralized ecosystem such as Web 3 ecosystem and help to access the data resources,legacy systems and the computation of the data on advanced level. Blockchain act as the intermediaries and connect the on chain data and off chain data. Oracles helps to build the system that provides the information or linked the information of the traditional world with the blockchain system.

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We can take the examples of two persons who are betting different amounts .There will be the smart contracts that execute the inputs and outputs respectively and helps them to gain the profit from these bets. The true decisions of the betting winner is possible by the connection of the off chain and on chain data that is interlinked with the blockchain oracles.

There is a distributed ledger aspect in the blockchain ecosystem is not that is present in the network give result that is important. In the connection of different nodes that are validating the transactions of each other every time there will be a different result.The smart contracts in the blockchain helps to deliver the reliable data with the security.

_{Picture is taken from Pixabay}

So blockchain oracles term can be summarise as these are the entities that helps to make the connection between the traditional and blockchain ecosystem and also the data can be computed or transferred between the bridge.In this regard there is also the smart contracts that trace the input and outputs and final results is executed reliably.

Types of Blockchain Oracles

Blockchain oracles helps to build the connection of the blockchain ecosystem to the real world and the verification of data is proceeded in different steps.The verified data is used in the smart contracts that execute the processing according to the input and outputs data. On the basis of functionality and complexity of blockchain oracles these are divided in different types that I will explain below.

Softwares Oracles

The software oracles helps to implement the information that is collected through different online resources like the temperature prices of different things or transportations development. The software oracles helps to build the smart contracts based on the online sources information

Hardware Oracles

These are the types of rackles that implement the information from the physical situations or movements such as different movement sensors are used that detects the physical situation and implement the data into the small contracts. Another examples is the different sensors used in industries, offices and businesses.

Cross chain Oracles.

This type of oracles are built to read and write information in different interlink blockchain it helps to move data or the assets between different block chains. So that is also if a presented by its name that it is a cross in Oracle that built the connection between two different blockchain blockchain and helps them to Trigger an action on the information that is collected from the relative blockchain.

Centralized or Decentralized Oracles

We are well there of the day difference between the centralised and decentralized in system just like that the oracles are of different types centralised and decentralized. In decentralized rackers the information is managed for controlled by different entities and it has more security like the decentralized blockchain. On the other hand in centralised oracles the single entity is responsible for controlling of the data it also increases the chances of cyber attacks.

Computation Oracles

This is the type of oracle that compute the data and give the outputs for examples the calculations are performed and the output is stored in the smart contracts for execution.

InBound Oracles

These are the type of oracles that only send the data from the real world to the blocks in ecosystem so that the further processing and utilisation of this real data and occur these oracles are in bounder occurs and does not support the information out from the blockchain it only collects the information from the real world.

Outbound Oracles

Outbound oracles are the types that helps to receive the information from the virtual word it is working is only to receive the information it cannot send the information in anyway you can say that it is opposite to the inbound oracles.

What do you think about decentralized Oracles?

We know that in the decentralized blockchain the data is not controlled by the third part or the single authority is not present. The same case is with the decentralized oracles I also have expalined above briefly. The decentralized oracles consist of the entities that implement or interconnect the information or data from different nodes.

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The concept was implemented due to the many innovative features of the decentralization of the blockchain system. In case of the centralised oracles data is validated by a single entity and in case of any app there will be no chances to retrieve data and there is less security in this Oracle because any scammer can attack from anyway.

In the case of decentralization thousands of the nodes are involved in the implementation or the retrieving of data. This provides the lot of benefits such the security,reliability and the less risk of scamming helps. Decentralized nature of the oracles comes with the more reliable and better systems to develops the connection between the ecosystem and blockchain.

Due to this vast and reliable nature these oracles are used in the large scale businesses, in industreis and many more applications we see that I will explain later.

_{Picture is taken from Pixabay}

Decentralized oracles helps to develop the network that uses the hybrid smart contracts in which off chain and onchain complex infrastructure are combined or coupled to develop the decentalized application we said dapps moslty that interlink the real world and traditional systems world.Some examples of the decentralized oracles are

• Switchboard
• chainLink
• APIs
• Pyth network

So these are some major blockchain decentralized oracles.

Give us a use case of a decentralized Oracle.

There are many use cases of the decentralized oracles I will discuss some of them here.

DeFi

The decentralized finance is a use case of descentralized oracles. There is a need of that a ecosystem in markets and the implementation of oracles here helps to calculate the data of customers borrows capacity and levels of collateralization.In many projects the decentralized oracles are used in regards to peg the coins with the real world assets.

Insurance

There are many transparency problems in the insurance system such that the information difference between two parties. In insurance the customer always want that the transactions and the money he pays should be fully approved from the company and process should be transparent and Secure but in most of the cases this is very slow process and the transptation is not gurranted.

_{Picture is taken from Pixabay}

Now the recent oracles are used that gather and uses the information through different API and then implemented to this mode control contracts that I used for the further execution and verification that the customer has paid all the necessary amount so in this way this provides the trust to the customers to the insurance.

NFT

In non decentralized oracles are used to ensure the value and distribution of the NFT atoms that is process by different computing oracles and generate the random NFT and then select the winner after the verification and validation through this smart contracts.

Cross chain Service

Another use case of the decentralised oracles are solving the major problems between different blockchains as I mentioned above the cross oracles are used to transfer data and interlink them between different blockchain.

In this way they provided the service to share the information between two blockchain in the cross way.

Conclusion

Blockchain Oracle enter link the information between the blog change and real world or traditional system.There are many decentralized oracles that are practically used in the industries and make the working more easier.It also enhances the security level of the systems.

_{I invite the @steemdoctor1 @luimer79 @fantvwiki and @nadiaturrina to participate in the contest}

Thank you

Achievement 1

written by:@cryptoloover