Can blockchain solve its oracle problem?
Hello, guys! Since we're on a bearmarket and we have lots of time to learn more about crypto and future great projects, allow me to raise a debate about the future of blockchain.
1) Let's start by discussing about how smartcontracts can be used in the real world.
In order for blockchain to be used at their full potential, you need it to connect it with the real world data. Blockchain oracles are the means by which real-life data — like football scores, rainfall measurements or election results — are transmitted to a blockchain. Imagine that X and Y wish to place a wager on the outcome of a horse race. How would the smart contract know who to give the winnings to? An oracle can retrieve the information from the real world and deliver it onto a blockchain. Bitcoin and other native tokens don't need oracles because they do not represent or refer to anything outside of their own blockchains- my opinion is that those systems will not bring the adoption we all want to see.
2) What is the problem with existing oracles?
Now let's say we have a house sale from X to Y. The smartcontract needs to verify if the house was actually transfered. That means there has to be a third party that you trust to verify the event in the real world actually happened. The most advanced oracle at the moment is ChainLink. Can you actually trust it? The answer is no. Here's why: For a p2p network to be decentralized, it has to be both OPEN and SYBIL RESISTANT. Chainlink is not both. You can either use it openly, then any node can be a malicious sybil node and there's no way to know, or you can use it by trusting the KYC provided by the Chainlink team, or some other arbitrary centralized reputation source. There is no mechanism for decentralized reputation in Chainlink. There's a centralized "reputation", which is utterly useless, you're just trusting another centralized guy. Let's also mention Chainlink team owns 30% of the coins.
A truly decentralized oracle network must be one where the data sources are chosen by the community, the validators are elected by the community, and the rules around staking, including rewards and slashing penalties, are also set by the community and not by a central authority,
3) Is there a solution?
Yes, I actually found one future solution- Portus Network. How is Portus solving the oracles problem?
Portus is an open, trustless, permissionless API oracle. It is both an Inbound Oracle and an Outbound Oracle with features designed to ensure information validity and action traceability:
- Open because it is built from open-source software and made available as open-source software for full transparency.
- Trustless because the network allows participants to interact publicly or privately without requiring a trusted 3rd party.
- Permissionless because anyone can participate without authorization from a governing body. This is valid for both consumers and providers.
One component of the Portus network is the Portkey node. It's a piece of software that is both an Inbound and Outbound Oracle and sits at the API provider's premises. As an Inbound Oracle (or Data Provider), they simplify the entire process, making the data provider itself an oracle node. This will make the middle layer obsolete, which is a tremendous achievement that solves many of the problems traditional data oracles face in terms of redundancy, performance, and scalability. As an Outbound Oracle, the Portkey node acts as an on-chain information source for API providers. API providers can use blockchain data to trigger actions and trigger events in a way that's consistent with all blockchains Portus supports.
Now, I won't tell you more about the one possible solution for the oracles problem because if there are tech passionates, they will do their own research. I just want to add one more thing: Portus is not launched yet, it's in the process of licensing in Malta (the most restrictive crypto reglementation that exists). This is a serious project, not some meme coin rug pull.
I will provide you a list of useful links (official groups/pages) so you can do your own research and ask your own questions (the team is very open to tech discussions/debates):
Twitter: https://twitter.com/portusnetwork
Telegram (here you can find the team answering tech questions in real time): https://t.me/portusnetwork
They also launched a beta of their product, so anybody can see their tech: https://www.portusnetwork.org/download
I really think that this project should be on your radar. It's not going to public sale in the next month, but it will one day and it's gonna be a real moonshot.
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