mev-toolkit/oracles/README.md
Dr. Mia von Steinkirch 5d51aaf971
🍋 add TWAP oracles
2022-10-17 17:32:09 -07:00

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## 🍋 oracles
<br>
### tl;dr
* Oracles provide a trustless way of getting extrinsic (off-chain) information.
* They provide the some key functions such as collect data from an off-chain source, transfer the data on-chain with a signed message, and make the data available by putting it in a smart contracts storage.
* price oracles are any tool showing an asset's price but in context of defi
<br>
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### in this repo
* [TWAP oracles](twap.md)
<br>
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### chainlink
A decentralized oracle network consisting of three key smart contracts:
* a reputation contract: keep track of data providers' performance.
* an order-matching contract: selects bids from oracles using the reputation contract.
* an aggregation contract—and an off-chain registry of data providers.
One of the main challenges with such a decentralized approach is the formulation of the aggregation function.
ChainLink proposes calculating a weighted response, allowing a validity score to be reported for each oracle response.