Oracles

Infrastructure & Compliance Rails · Lesson 8.1

A blockchain only knows what has been written to it. It cannot see the price of a Treasury bill, a fund's net asset value or a property valuation. An oracle is a service that brings that kind of offchain information onchain, where smart contracts can use it.

For RWAs, oracles report reference values such as prices, net asset values, interest rates and reserve data. A tokenized fund may need its NAV published onchain, and a lending market that accepts tokenized collateral needs a price to set loan limits and trigger liquidations. Contracts act on whatever the oracle reports, so the quality of that data matters.

Wally’s note: the contract believes everything. zero judgment.

An oracle reports a value. Check where the value comes from and how often it is updated.

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