Blockchain technology is one of the most innovative of the last century and seems to be attracting more and more attention from the general public.
According to Forbes in the future more than $487 trillion will bring the world of blockchain, and oracles are the specific element that will enable this exponential growth.
Blockchain technology and the role of oracles
Blockchain technology acts as a distributed digital ledger where data of any type can be written.
The concept of immutable data is not new and has prehistoric origins, but in recent years it has become central again to mainstream narratives of new technologies.
To date, the best known and most widely used blockchains are public ones such as Ethereum, BSC, Polygon, Arbitrum, Optimism, and Cosmos.
In each of these chains, data comes first inherent in the world of cryptocurrency transcribed, while data from the outside world is almost non-existent.
This is determined by the fact that the blockchain technology itself unable to extrapolate data from the real world but does an excellent job of transporting and storing on-chain data.
In order for blockchain to play an important role in the development of society within social and administrative institutions as well as financial institutions, there must be a GATES which links these different realities.
Blockchain oracleslike those developed by Chainlink, essentially to do this task: they get external data such as, for example, weather information and election data and bring it to distributed networks.
Forbes believes that oracles are the main enabling element the expansion of this industry and the immersion of this technology in every area of daily life.
There is still a long way to go, and proper security systems and infrastructure capable of handling large amounts of data in the off-chain world are required to use blockchain in any context other than finance.
In addition, the barrier of technological knowledge hinders the progress of this expansion given that cryptocurrencies and DLT systems are still being considered niche concepts.
It will be interesting to see how the situation regarding crypto oracles changes in the coming years and if more and more information that is in the concrete world that we know today will be inside the blockchains.
Types of crypto oracles
there many types of crypto oracleswho play different roles based on their technological background.
In general, we can simplify the concept by distinguishing oracles from each other based on the source of the data, the direction in which the information moves, and how this data gains the trust of the end user.
- Data source: there are computer systems that collect data in digital version while others refer to physical data. Oracles can represent hardware or software system. Those of the software type refer to the most famous oracles in the crypto world such as those developed by Band Protocol, Quant and Chainlink projects, while hardware oracles are not yet on a large scale but represent the future of off- data transport chain. .
An example of a hardware oracle would be radio frequency identification (RFID) chips that identify external data such as weather conditions or health information. - Information direction: the direction of the data carried by the oracles can be incoming or outgoing: trivially, a piece of information can enter the blockchain from outside situations (real world) or it on the contrary goes from the on-chain world to the physical world.
Crypto-AI systems essentially serve to make this transition happen as authentically and efficiently as possible. - Trust mechanism: Trust is a central concept within this narrative. Become an oracle decentralized or centralizedd, and in both cases there are opposite directions in terms of dependence.
There are centralized systems “points of failure” ie, points where they can be attacked and information can be manipulated while decentralized systems do not have this flaw, they can still be compromised if the infrastructure they rely on has Errors in the code or the network nodes are not properly distributed.
Blockchain: the latest technologies of today
Blockchain innovations emerge and evolve every year.
In 2014, the crypto community has some distributed data computing systems are available and it can make a small list of actions.
After only 9 years we are looking at a considerable expansion of the blockchain ecosystem, yet the Ethereum Mainnet still emerges as the dominant and most widely used infrastructure on the web3 in the world.
New financial products such as tokenized shares, partially collateralized debt assumption, and decentralized credit issuance are just some of the innovations that have emerged in recent years.
ZK rollups technology, which allows on-chain actions to occur without revealing the corresponding datais one of the dominant trends of today and the near future.
Projects such as ZK sync, Layer Zero and Azero have planned their entry into the cryptocurrency industry in recent months, bringing them together. optimism about the future these technologies.
In fact, we can now boast of introducing these concepts through Optimism and Polygon, which serve as examples for the future. Zero Knowledge systems.
Another trend to consider for the future of blockchain is AI, IoT and EoT projects, which aim to automate processes we discussed in the previous paragraphs.
Introducing OpenAI’s flagship product, which is ChatGPT, perhaps the most eye-opening the potential of this technology, which actually seems to be on the edge of became dominant in any field of modern society.
Even the giant Amazon is about to introduce its own prototype chatbot able to respond to the needs of users and improve the relationship between individuals and computer systems.
We don’t know yet what is the direction of the future and if new technologies in the field succeed in making this world mainstream around the world.
What we can predict, however, is that evolution continues its course, and whichever path it takes, it will be successful for all mankind.