<s>
A	O
blockchain	B-Application
oracle	I-Application
is	O
a	O
third-party	O
service	O
that	O
connects	O
smart	B-Application
contracts	I-Application
with	O
the	O
outside	O
world	O
,	O
primarily	O
to	O
feed	O
information	O
in	O
from	O
the	O
world	O
,	O
but	O
also	O
the	O
reverse	O
.	O
</s>
<s>
Decentralized	O
oracle	O
networks	O
(	O
DONs	O
)	O
enable	O
the	O
creation	O
of	O
hybrid	O
smart	B-Application
contracts	I-Application
,	O
where	O
on-chain	O
code	O
and	O
off-chain	O
infrastructure	O
are	O
combined	O
to	O
support	O
advanced	O
decentralized	B-Application
applications	I-Application
(	O
dApps	B-Application
)	O
that	O
react	O
to	O
real-world	O
events	O
and	O
interoperate	O
with	O
traditional	O
systems	O
.	O
</s>
<s>
Many	O
Ethereum	B-Application
applications	O
use	O
oracles	O
.	O
</s>
<s>
For	O
example	O
,	O
prediction	O
market	O
Augur	B-Protocol
would	O
use	O
election	O
data	O
to	O
settle	O
corresponding	O
bets	O
.	O
</s>
<s>
Projects	O
like	O
Chainlink	B-Protocol
and	O
Pyth	O
provide	O
decentralised	O
oracle	O
network	O
services	O
to	O
many	O
blockchains	B-Application
.	O
</s>
<s>
Examples	O
of	O
data	O
transmitted	O
by	O
oracles	O
to	O
smart	B-Application
contracts	I-Application
include	O
price	O
information	O
,	O
the	O
successful	O
completion	O
of	O
a	O
payment	O
,	O
the	O
temperature	O
measured	O
by	O
a	O
sensor	O
,	O
election	O
outcomes	O
,	O
etc	O
.	O
</s>
<s>
A	O
hardware	O
oracle	O
can	O
be	O
seen	O
as	O
relaying	O
real-world	O
events	O
into	O
digital	O
values	O
that	O
can	O
be	O
understood	O
by	O
smart	B-Application
contracts	I-Application
.	O
</s>
<s>
Human	O
oracles	O
are	O
individuals	O
with	O
specialized	O
knowledge	O
who	O
can	O
verify	O
the	O
authenticity	O
of	O
information	O
before	O
relaying	O
it	O
to	O
smart	B-Application
contracts	I-Application
,	O
and	O
who	O
prove	O
their	O
identity	O
cryptographically	O
.	O
</s>
<s>
Outbound	O
oracles	O
send	O
information	O
from	O
smart	B-Application
contracts	I-Application
to	O
the	O
external	O
world	O
.	O
</s>
<s>
For	O
example	O
,	O
a	O
smart	B-Application
contract	I-Application
receiving	O
a	O
payment	O
could	O
send	O
information	O
through	O
an	O
outbound	O
oracle	O
to	O
a	O
mechanism	O
that	O
unlocks	O
a	O
smart	B-Device
lock	I-Device
.	O
</s>
<s>
If	O
an	O
oracle	O
relies	O
on	O
a	O
single	O
source	O
of	O
truth	O
(	O
centralized	O
)	O
,	O
that	O
can	O
lead	O
to	O
issues	O
:	O
the	O
data	O
source	O
can	O
be	O
hacked	O
in	O
a	O
man-in-the-middle	O
attack	O
,	O
or	O
altered	O
by	O
its	O
owner	O
,	O
in	O
order	O
to	O
sway	O
smart	B-Application
contracts	I-Application
.	O
</s>
<s>
Decentralized	O
oracles	O
(	O
consensus	O
oracles	O
)	O
increase	O
the	O
reliability	O
of	O
the	O
information	O
provided	O
to	O
smart	B-Application
contracts	I-Application
by	O
querying	O
multiple	O
data	O
sources	O
,	O
thus	O
distributing	O
trust	O
between	O
participants	O
.	O
</s>
<s>
However	O
,	O
this	O
does	O
not	O
achieve	O
trustlessness	O
,	O
since	O
oracles	O
are	O
not	O
part	O
of	O
the	O
main	O
blockchain	B-Application
consensus	O
,	O
and	O
thus	O
not	O
part	O
of	O
the	O
security	O
mechanisms	O
of	O
public	O
blockchains	B-Application
.	O
</s>
