Orcfax oracle on Cardano

Decentralized Finance on Cardano is exploding as new protocols show up everyday, bringing new utilities and tools to the ecosystem.

One piece of the puzzle that is actually missing is feeds and data from the external world. In fact, blockchains have not the built-in ability to fetch data from external systems or send data out. As such, they are isolated networks, like a computer with no Internet connection.

But off-chain data could open up countless use cases for blockchain and smart contract technology: this is why oracles exist.

What are oracles?

As people in the ancient world delivered messages and knowledge from the gods to the mortals, oracles deliver data about the real-world to on-chain smart contracts.

So we can say that oracles are bridges between the real world and smart contracts on the blockchain, allowing them to execute depending on real-events inputs and outputs. The data could be of various type: Exchange rates, weather data, market prices, economic indicators, news, calendar events, sport scores and many more.

This data comes from various online outlets, including website content and open datasets but, primarily, server-based application programming interfaces (API).

To foster organic growth within the ecosystem, it’s imperative to seamlessly integrate an increasing amount of real-world data into the blockchain. This integration is crucial for dApps and protocols to attain their genuine objectives. Maintaining true decentralization in Cardano requires leveraging data that is inherently reliable and authentic, eliminating the need for dependence on third parties.

Orcfax

Orcfax is a decentralized oracle feeds that publishes data about real world events to the Cardano smart contracts through COOP, the Cardano Open Oracle Protocol.

COOP is a free and open-source set of technical guidelines that provides the specifications for the publication and consumption of off-chain data by smart contracts.

Orcfax implements a triangulation principle, collecting data from at least three indipendent sources via a decentralized pool of validator nodes. This is needed to ensure that collected data is authentic and reliable. Also, standards-compliant archival packages are generated for auditing the data collection, validation and publication process.

What is expected

The first phase of the roadmap sees the so called Federated Mainnet Feeds: data, limited to price feeds from CEX, is collected and validated in a federated network of nodes operated by Orcfax.

During Phase 2 an Incentivized Testnet is foreseen, and mainnet is planned immediately after it. The final goal is that to provide multiple data feeds using a fully decentralized network of nodes managed by independent node operators who staked their $FACT tokens in order to collect and validate this data. This Phase is expected to begin in 2024.

In the next article..

In the next article we will explore the ISPO conducted by Orcfax and the $FACT token, its tokenomics and launch.