Why your chain needs decentralized, open source, and App specific Oracles

Imagine you’ve just launched a new blockchain, and you’re eager to attract developers to build on it. Your chain has all the technical bells and whistles, and you’re excited to see what creative applications will emerge. But there’s one problem: your chain doesn’t have reliable data feeds, like price feeds, which are essential for DeFi, NFTs, and other data-driven applications. Without them, developers are limited in what they can build, and your ecosystem could struggle to gain traction.

So, you start exploring solutions, and that’s when reality hits. Traditional, centralized oracle providers come with a hefty price tag. For example, a recent blockchain reported that they were quoted upwards of $1 million for a oracle solution. That’s a significant investment, especially for a project in it’s early stages, and it may be out of reach for many blockchains.

Then you think, “Maybe there’s a cheaper option.” You consider offering a grant, perhaps $200,000 to fund a custom-built solution from a smaller provider. But in reality, this is often a risky proposition. Smaller, underfunded oracle solutions can lack the robustness and maintenance necessary to keep up with your chain’s growth and needs. Based on a true story, that occurred to a blockchain network we interviewed. While they tried this approach, the solution ended up being inconsistent and difficult to maintain over time and they eventually abandoned them.

And even if you do secure price feeds, what’s the real advantage of this? Sure, you’ve checked off an essential box, but is it enough to propel your chain forward and set it apart from competitors?

The Oracle Problem: Why Chains and Apps Struggle with Current Solutions

Oracles are the bridge between blockchains and the real world. They allow smart contracts to access external data, like asset prices, weather reports, and sports scores. Without them, decentralized applications (dApps) are limited to information solely on the blockchain. But traditional oracle solutions often need to catch up, especially regarding decentralization, cost-effectiveness, and flexibility.

1. Cost: High-quality, centralized oracle providers can cost hundreds of thousands of dollars — sometimes even millions — for a single chain integration. For smaller chains or projects with limited budgets, this expense can be prohibitive.
2. Flexibility: Generic oracles are built to serve a wide range of use cases, which means they’re often not optimized for specific applications. This lack of specialization can limit their effectiveness for apps with unique data requirements.
3. Reliability and Maintenance: Custom-built oracles created with limited funding often lack the reliability, support, and continuous updates necessary to adapt to a growing chain’s needs.
4. Decentralization: Many traditional oracles are centralized to some extent, which can create vulnerabilities and reduce trust. When you’re building on a decentralized blockchain, having a centralized data provider goes against the very ethos of decentralization.

Why Chains Shouldn’t Rely on Apps to Build Their Own Oracles

One of the biggest challenges with current oracle models is the expectation that apps are responsible for setting up and maintaining their own oracles. However, this approach places an unnecessary burden on developers and creates inefficiencies within your ecosystem. Here’s why:

1. Focus on Innovation: When developers are forced to build their own oracles, they have less time and resources to focus on what matters — building innovative applications. By providing robust, app-specific oracles, your chain can attract developers who are free to innovate without worrying about backend infrastructure.
2. Consistency Across the Ecosystem: When each app builds its oracle solution, data consistency can become an issue. With a standardized oracle solution like Gora, you ensure consistent, high-quality data across all applications on your chain, which improves reliability and fosters a cohesive ecosystem.
3. Lower Barriers to Entry: New and emerging projects may not have the resources to build custom oracles. By offering a decentralized, open-source oracle solution, you make your chain more accessible, allowing smaller projects to join your ecosystem and grow it organically.
4. Stronger Security: Decentralized and standardized oracles reduce the risk of vulnerabilities that can arise when each app builds its own oracle solution. By providing a trusted, secure oracle model, your chain can offer developers and users peace of mind.

Application-Specific Oracles: Supporting a Range of Industries

Blockchain ecosystems are moving beyond DeFi and into areas where complex, industry-specific data is essential. Application-specific oracles provide tailored data that meet the needs of specialized applications. For instance, logistics platforms need supply chain data, insurance platforms need actuarial or weather data, and sports betting applications need real-time sports stats. A one-size-fits-all oracle cannot serve these needs adequately.

By deploying application-specific oracles, chains can create industry-friendly environments that simplify the integration of crucial data for various applications. This specialization doesn’t just attract developers from traditional industries — it encourages them to build solutions optimized for their unique requirements, paving the way for a more diverse ecosystem.

Eliminating the Burden on Developers: Focus on Innovation, Not Infrastructure

Requiring developers to build their own data integrations can discourage innovation. When developers allocate resources to building and maintaining their own oracle solutions, they divert valuable time and energy away from improving their core applications.

A robust oracle infrastructure relieves developers of this responsibility, empowering them to focus on core functionality rather than backend data access. By offering reliable, easy-to-integrate oracles, a blockchain network can significantly enhance its appeal, making it a go-to platform for developers who want a streamlined experience with minimal setup requirements.

Why Every Chain Needs a Better Oracle Solution

As blockchain ecosystems continue to expand, the demand for decentralized, secure, and application-specific data will only increase. Chains must look beyond basic price feeds to build an infrastructure that can accommodate a wide array of applications. Decentralized, open-source, and tailored oracle solutions provide not only cost savings but also the flexibility, security, and reliability needed to support real-world applications across different industries.

By adopting oracles that go beyond the one-size-fits-all model, chains can attract a broader pool of developers and applications, ensuring that their ecosystem is adaptable, relevant, and equipped for the future.