Blockchain oracles are essential for Web3 applications like Dapps to work properly and deliver due benefits to the correct users. Moreover, Blockchain Oracles also help Smart Contracts execute functions like Bidding, Escrow, Match Predictions, Crypto Futures and Options, etc.
A slight delay in data delivery can hamper the execution of several smart contracts and can cause severe financial loss. Therefore, Trustworthy Oracles are needed to bolster end-user and investor confidence.
The Problems of the Past
In recent months, we have seen how several smart contract executions did not happen due to error-prone blockchain oracles. In the case of Three Arrows Capital, a slight delay in data reporting by a popular oracle saved it from liquidation, ultimately resulting in Three Arrows capital going bust with $10B of funds.
Another issue was that of Terra LUNA 1.0, where the fall of UST Stablecoin and LUNA coin was so rapid that many exchanges reported different prices at the same time due to a lack of timely and accurate information. This incident would not have happened if there had been a fast enough blockchain oracle present.
Such incidents can wipe out your funds if your exchange uses an unreliable Blockchain Oracle. You will only know about your loss when the damage has been done.
We have brought you a list of three Blockchain Oracles that are both fast and secure. They can keep your data safe and deliver new information at blazing-fast speeds.
QED is a blockchain oracle that fulfills the requirements of safety and speed. The decentralized oracle is built to reward nodes with greater historical accuracy, ensuring efficient data delivery.
Further, the Oracle Network is based on hard external collateral, which eliminates systemic risk. It means that there will be no “bank run”(a sudden rush to sell coins and get out of the network) even if crypto prices fall.
Talking about security, QED has never been hacked, exploited or compromised. This fact is evident from the crypto Black Thursday of March 12, 2020, when QED functioned properly, even at full capacity, without any glitches.
On the speed metric, it has a refresh rate of 0.5 seconds which is the fastest in our list.
API3 is a unique blockchain oracle that eliminates third-party intermediaries to deliver data to blockchains.
API3 helps you call any Web3 API directly from a smart contract. It uses first-party data feeds called beacons to deliver data to smart contracts. API3 claims they are transparent, cost-efficient and scalable ways to feed data into smart contracts.
The platform also has its token API3 but is controlled by a DAO, reducing any risk of ulterior motives.
The Band Protocol is a blockchain oracle that works on multiple blockchains, such as Ethereum and Cosmos. The project is backed by well-known Investment Funds like Sequoia and Binance. The protocol hosts a series of Web2.0 data which it securely bridges to the smart contracts.
Their primary focus is on the technology of the oracle and developing it based on community inputs.
The protocol is based on the Cosmos SDK and has its Blockchain called the Band Chain. It has an average response rate of 6 seconds.
However, it has an inbuilt token that exposes it to a degree of systemic risk.
Blockchain Oracles are the hidden mechanism which makes Web3 as secure as you see today. Any faulty oracle can cause losses in millions or billions. A properly blockchain oracle delivers data securely on smart contracts and makes sure that the data is accurate and timely.
We have listed three blockchain oracles that are each unique in their own respect. QED is the fastest and has never been hacked. API3 eliminated the need for third parties and directly let smart contracts access off-chain data. And finally, the Band Protocol has multi-chain functionality. All three access and transfer data in a fast, efficient and secure manner.
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