Oracle

How it is used

Used heavily in DeFi: price oracle, oracle feed, oracle manipulation. Since a contract cannot check the outside world by itself, a wrong or manipulated oracle price can trigger unfair liquidations, which is why teams combine several data sources.

Example sentences

1. The lending protocol uses an oracle to get the current price of each collateral token.

2. Attackers manipulated the oracle price and borrowed far more than their collateral was worth.

Common collocations

• price oracle
• oracle feed
• oracle manipulation
• oracle network

Related terms

• smart contractA program stored on a blockchain that runs automatically when certain conditions are met. Once deployed it usually cannot be changed, and it can hold and move funds without a middleman.
• DeFiShort for decentralized finance: financial services such as lending, borrowing and trading that run on smart contracts instead of through banks or brokers. Users keep control of their own wallets.
• liquidationThe forced closing of a leveraged position or a loan when the value of the collateral falls below a required level, so that the lender or the exchange does not lose money.
• collateralAssets that a borrower locks up as security for a loan or a leveraged position. If the debt is not repaid or the collateral loses value, it can be sold to cover the loss.
• exploitAn attack that takes advantage of a bug or design weakness, often in a smart contract or bridge, to steal funds or make a system behave in a way its creators did not intend.

More terms: Smart Contracts & dApps

• dApp
• Solidity
• EVM
• audit
• deploy
• protocol
• DAO