The Oracle Problem
A system is only as decentralized as its most centralized link.
An oracle is a special type of messenger that can fetch information from the outside world and safely bring it to any smart contract on-chain. This information could be anything, like the price of an asset, the result of an election, or the temperature in a certain city.
Oracles act as a bridge between the blockchain and external data sources, allowing the blockchain to access and use real-world information and events in a decentralized manner.
Oracles are an essential component of many blockchain-based systems, as they enable the blockchain to interact with the outside world and use a wide range of data that is not stored on the blockchain itself.
Because blockchains are decentralized networks that rely on a distributed set of nodes to validate and record transactions, they do not have direct access to data stored outside of the blockchain. Oracles provide a way for blockchains to access and incorporate this external data.
Going beyond today’s definition of an oracle, SEDA is a multichain-native data transmission protocol built on an entirely decentralized foundation. The SEDA network is a Proof-of-Stake on-chain data provision solution that allows anyone to provide and access high-quality data on all blockchain networks. It is a living market and transport layer that enables access and flow for any type of data through a transparent and secure medium, free of centralized intermediaries.
SEDA is a trustless data layer that acts as a bridge between the blockchain and the real world, making it possible for all integrated parties to carry out data requests, connect to any data source and query its data in a fully permissionless way.
SEDA does not create data or ensure the data is correct. Rather, it ensures the data can pass through the system in a secure and trustless manner by providing a channel for external data and information to flow to and between any blockchain. SEDA is flexible and adaptable, able to fetch a wide variety of data from different sources and formats and provide it to the smart contract in a usable form.