Working for oracle: Who We are – Life at Oracle | Careers

18 Pros and Cons of Working at Oracle

Oracle is one of the largest software companies in the world, providing cloud applications and platforms that are used by individuals and businesses alike.

When you want to embrace the tech side of things, Oracle can be a great company to work for.

There are both pros and cons to working for them, so it is best to know what to expect before you choose to apply with Oracle.

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Table of Contents

• Pros of Working for Oracle
  • 1. Great Pay
  • 2. Premium Benefits
  • 3. Lots of Learning Opportunities
  • 4. Good Work-Life Balance
  • 5. Lots of Training
  • 6. Flexibility to Telework
  • 7. Lots of Projects to Work On
  • 8. Multiple Locations to Choose From
  • 9. Good Retirement Program
  • 10. Looks Great on a Resume
• Cons of Working for Oracle
  • 1. Hiring Process is Long
  • 2. Poor Work Culture
  • 3. Promotions are Hard to Get
  • 4. Lots of Micromanagement
  • 5. Bureaucracy
  • 6. Limited Input on Decisions
  • 7. Raises are Low
  • 8. Retention is Low
• Pros and Cons of Working at Oracle – Summary Table
• Should You Work for Oracle?

Pros of Working for Oracle

With Oracle being such a large company, it can provide an array of benefits for you to enjoy as an employee.

1. Great Pay

The average annual salary given to Oracle employees is an impressive $136,000 – and that breaks down to approximately $65 per hour.

Of course, the wages will depend on your position.

The highest-paid job is a Director of Sales, earning a bit over $300,000 a year.

Meanwhile, an office manager earns a salary of around $50,000.

What you earn depends on your experience, your education, and the way in which you negotiate.

2. Premium Benefits

There are a lot of benefits provided to employees at Oracle.

In addition to the standard package of health, dental, and vision, you are also given access to life insurance, disability insurance, a health savings account, and more.

There is a strong focus on well-being, complete with access to physical and mental health perks.

You will have an employee assistance program for counseling, be able to obtain adoption assistance, and more.

3. Lots of Learning Opportunities

There are various learning opportunities with Oracle.

You will have access to various programs within your position.

Additionally, you can seek a degree as part of employee training and development.

Tuition reimbursement is available with manager approval, allowing you to focus on a degree that is related to your job – up to $5250 per calendar year.

4. Good Work-Life Balance

Oracle works to provide you with a strong work-life balance so that you can form relationships and enjoy a family.

You will not be working all the time.

Instead, you will be given sick time, paid holidays, a leave of absence for various reasons, and a winter break that spans from Christmas to New Year.

Additionally, you will accrue 13 days of vacation per year for the first three years with the company and 18 after that.

5. Lots of Training

The company provides a lot of training to help you understand the role in which you were hired.

You will conduct some of the training with the HR department and some of it within your department.

Depending on the position, you may even shadow another employee for a while until you are ready to go on your own.

Ongoing training is also provided so that you can reach for other positions within the company.

6. Flexibility to Telework

Many positions provide you with the opportunity to telework.

Often, the rule is that if you live more than 50 miles away from your location, you can telework.

There are often ways that you can telework for other reasons, as long as it is approved by management.

This can offer you a significant amount of flexibility, help with your work-life balance, and prevent you from having to deal with a commute.

7. Lots of Projects to Work On

There are always new projects going on at Oracle.

This allows you to get involved in various tasks and have something fun and exciting to work on.

You will rarely get bored when you work for Oracle because of its innovative approach to technology.

Plus, you will get a chance to share your ideas, which can lead to the next big project that comes out of the company.

8. Multiple Locations to Choose From

The company is based around the world.

The headquarters are in Austin, Texas and you will find field offices in California, Colorado, Florida, Illinois, Maryland, Massachusetts, Minnesota, Montana, and beyond.

There are also data centers in 20 countries including Brazil, Germany, Australia, and more.

You can choose to work wherever you desire – and you may even find that you are asked to transfer to a different location than where you started.

9. Good Retirement Program

The retirement program with Oracle is in the form of a 401k – and it is a great one so that you can build your retirement savings quickly.

You are allowed to contribute up to 10% of your base salary, and there is a 50% match on the first 6%.

You are fully vested within four years of working for them.

Additionally, you have the ability to purchase company stock and receive a 5% discount on the shares.

10. Looks Great on a Resume

Oracle has recently been identified as the third-largest tech company in the world.

That means that putting them down as a former employer is going to look great on your resume.

When you openly announce that you work for Oracle, you may even find that you get job offers from other companies, inviting you to make the move to a different tech company.

Cons of Working for Oracle

There are cons to working for such a large, diverse company.

Knowing the cons will help you to know what you are getting yourself into.

1. Hiring Process is Long

The time it takes from submitting your resume to the time you are offered a position with Oracle can take months.

You may have to go in for several interviews, conducted over the phone and in person.

Even after the interviews, there may be several follow-up questions that slow the entire process down.

In the meantime, you may have turned other positions down in hopes of getting hired by Oracle.

2. Poor Work Culture

There’s a poor work culture as there isn’t anything “above and beyond” for the employees who work for Oracle.

Some point out that other tech companies have entire complexes to attract employees.

Oracle offers discounts and employee benefits, but they do not do anything to keep employees happy.

There are no company picnics, there are no free lunches, and there are no arcades or exciting breakrooms.

3. Promotions are Hard to Get

Promotions are hard to get because of how competitive the company is.

The company pays well, and they don’t necessarily hire from within.

They will be just as happy to hire a college graduate with a great resume as they will to hire you if you’ve just earned your degree while working at the company for the past five years.

You will need to attract management’s attention to even be considered for any of the open positions that you qualify for.

4. Lots of Micromanagement

The company has a lot of managers – perhaps more managers than they need.

As a result of this, many employees feel as though they are being micromanaged over deadlines, productivity, and general output.

This also leads to more stress on the job because there is always someone peering over their shoulders or double-checking what they’re doing or when something will be sent over.

5. Bureaucracy

There are over 130,000 employees within Oracle, so it is a large company that operates worldwide.

With large companies comes a lot of bureaucracy.

You will find that there’s a lot of hierarchy, and many employees will say that there is a lot of top-down leadership that goes on.

You will find that there are a lot of rules and regulations that do not make a lot of sense.

And the company will make political statements periodically that may not align with your own values.

6. Limited Input on Decisions

You will not have much input on the decisions made by the company.

There are very few surveys sent out throughout the year, so the company is clearly not interested in what employees have to say about any of the hot topic issues.

Additionally, a core group incorporate are the ones making the big decisions.

You either accept them or you don’t.

7. Raises are Low

Many employees complain that raises are low in comparison to other companies.

Once you are hired by the company, you will not see your salary climb unless you get promoted to a higher-paid position.

Many say that the annual raises are not even capable of covering the general cost of living increases, with most saying that they saw a rise of only 1 to 1.5 percent.

8. Retention is Low

The company does not invest a lot in retaining its employees.

Many past employees complain that they focus on giving too much money to corporate executives and not enough to current employees that are doing all of the work.

The result of all of this is that employees grow tired of seeing new employees come in being paid higher than they’ve been getting paid – and they are forced to train the newly hired employees that are earning more.

Pros and Cons of Working at Oracle – Summary Table

Pros of Working for Oracle	Cons of Working for Oracle
1. Great Pay	1. Hiring Process is Long
2. Premium Benefits	2. Poor Work Culture
3. Lots of Learning Opportunities	3. Promotions are Hard to Get
4. Good Work-Life Balance	4. Lots of Micromanagement
5. Lots of Training	5. Bureaucracy
6. Flexibility to Telework	6. Limited Input on Decisions
7. Lots of Projects to Work On	7. Raises are Low
8. Multiple Locations to Choose From	8. Retention is Low
9. Good Retirement Program
10. Looks Great on a Resume

Should You Work for Oracle?

Oracle is a growing company that is highly praised for its tech contributions.

While based in Austin, there are locations around the globe.

By taking the time to familiarize yourself with the pros and cons of the company, you can decide if it’s the right kind of work environment for you.

Do not be afraid to ask questions during the job interview and negotiate so that you can love the career that you have.

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Jamie Willis

Career Specialist at Becomeopedia

Hi, my name is Jamie Willis, and I have been helping students find their perfect internships and education paths for the last ten years. It is a passion of mine, and there really is nothing better than seeing students of mine succeed with further studies.

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Working At Oracle: Company Overview and Culture

Oracle overview

Industry

Computer Software

Revenue

$42.4B

Headquarters

Redwood City, CA

Employees

132,000

Founded In

1977

Website

www.oracle.com/index.html

Organization Type

Public

CEO

Safra A. Catz

Oracle is shifting the complexity from IT, moving it out of the enterprise by engineering hardware and software to work together-in the cloud and in the data center. By eliminating complexity and simplifying IT, Oracle enables its customers-400,000 of them in more than 145 countries around the world-to accelerate innovation and create added value for their customers. By engineering out the complexity that stifles business innovation, Oracle is engineering in speed, reliability, security, and manageability. The result is best-in-class products throughout an integrated stack of hardware and software, with every layer designed and engineered to work together according to open industry standards. Oracle’s complete, open, and integrated solutions offer extreme performance at the lowest cost-all from a single vendor. Integrated, industry-specific solutions are engineered to address complex business processes across a wide range of industries. For customers needing modular solutions, Oracle’s open architecture and multiple operating system options provide unmatched benefits from best-of-breed products in every layer of the stack. This allows customers to build the most optimized infrastructure possible for their enterprise.The staff at Oracle come from unusually diverse demographic backgrounds. The company is 32.3% female and 49.1% ethnic minorities. Despite its diversity in other areas, Oracle employees are noticeably lacking in political diversity. It has an unusually high proportion of employees who are members of the Democratic Party, at 74. 0%. Employees seem to enjoy working in an otherwise diverse workplace that is dominated by members of the Democratic Party. Oracle has great employee retention with staff members usually staying with the company for 5.2 years. The average employee at Oracle makes $101,392 per year. Pay at Oracle is significantly lower than some of its highest paying competitors, like Meta, Google, and Microsoft, which pay $155,739, $140,774, and $131,100, respectively. Based in Redwood City, CA, Oracle is an industry leader with 132,000 employees and an annual revenue of $42.4B.

Oracle’s mission statement

We foster an inclusive environment that leverages the diverse backgrounds and perspectives of all our employees, suppliers, customers, and partners to drive a sustainable global competitive advantage. The statement describes what oracle does for its clients and the purpose of these …

Perks of Working at Oracle

Provides great benefits such as 401k plan, health coverage and flexible time off. Co-workers and friendly and company is well managed. You have the option to work from home.

4.2/5

Oracle employee reviews

Based on 18 ratings

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Help job seekers learn about working at Oracle

Job openings at Oracle

5,610 Positions

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Average salary at Oracle

$101,392 yearly

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Oracle employee reviews

Oracle employee reviews

4.2/5

Based On 18 Ratings

Work At Oracle? Share your experience.

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Employee Reviews

Jun 2023

Oracle pays well and has good benefits. If you are able to make your organization’s target numbers, the quarterly bonuses are quite generous.

Oracle is a very difficult company to work for – not because its clients or products, but because of how large the organization is, how siloed, and how bureaucratic it is. Also, while it says it’s a people based organization, it’s decisions and how it treats people are not people based. It will always come down to the numbers.

Benefits

The quarterly bonuses

May 2023

Hard to get a salary increase. Old tech stack.

Tech stack. Lot of Burocracy.

Apr 2023

An excellent office environment that encouraged teamwork.

Limited upward mobility and pay rate.

Benefits

Good job benefits- 401k and health care package

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Oracle Rankings

Oracle is ranked #33 on the Best Technology Companies to Work For in America list. Zippia’s Best Places to Work lists provide unbiased, data-based evaluations of companies. Rankings are based on government and proprietary data on salaries, company financial health, and employee diversity.

• #33 in Best Technology Companies to Work For in America
• #52 in Best Fortune 500 Companies to Work For in America
• #65 in Best Companies to Work For in California
• #11 in Best Technology Companies to Work For in California
• #13 in Best Fortune 500 Companies to Work For in California
• #1 in Best Companies to Work For in Redwood City, CA
• #1 in Best Technology Companies to Work For in Redwood City, CA
• #1 in Best Fortune 500 Companies to Work For in Redwood City, CA
• #22 in Biggest Companies in California
• #1 in Biggest Companies in Redwood City, CA

Read more about how we rank companies.

Oracle salaries

9.8

Diversity Score

We calculated Oracle’s diversity score by measuring multiple factors, including the ethnic background, gender identity, and language skills of Oracle’s workforce.

Research Summary. Using a database of 30 million profiles, Zippia estimates demographics and statistics for Oracle. Our estimates are verified against BLS, Census, and current job openings data for accuracy. After extensive research and analysis, Zippia’s data science team found that:

• Oracle has 132,000 employees.

• 32% of Oracle employees are women, while 68% are men.

• The most common ethnicity at Oracle is White (51%).

• 21% of Oracle employees are Asian.

• 14% of Oracle employees are Hispanic or Latino.

• The average employee at Oracle makes $101,392 per year.

• Oracle employees are most likely to be members of the democratic party.

• On average, employees at Oracle stay with the company for 5.2 years.

Oracle Office Locations

Oracle is headquartered in Redwood City, CA

Biggest Oracle Locations

Videos About Working At Oracle

5 reasons to work at Oracle

Sneak Peek: Oracle Digital Dublin’s Cloud Solution Consulting Internship

Day in the Life of Sarah Ali – 2019 summer marketing intern

Oracle Financial Performance

9. 9

Performance Score

We calculated the performance score of companies by measuring multiple factors, including revenue, longevity, and stock market performance.

Oracle Annual Revenue

$42B

$34B

$25B

$17B

$8B

$0

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Highest paying Oracle competitors

Some of the competitors of Oracle are Meta, Google, and Microsoft. Employees at Meta earn more than most of the competition, with an average yearly salary of $155,739. The salaries at Google average $140,774 per year, and the salaries at Microsoft come in at $131,100 per year.

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Oracle FAQs

When was Oracle founded?

Oracle was founded in 1977.

How many Employees does Oracle have?

Oracle has 132,000 employees.

How much money does Oracle make?

Oracle generates $42.4B in revenue.

What industry is Oracle in?

Oracle is in the computer software industry.

What is Oracle’s mission?

Oracle’s mission statement is “We foster an inclusive environment that leverages the diverse backgrounds and perspectives of all our employees, suppliers, customers, and partners to drive a sustainable global competitive advantage. The statement describes what oracle does for its clients and the purpose of these …”

What type of company is Oracle?

Oracle is a public company.

Who are Oracle’s competitors?

Oracle competitors include Microsoft, Cisco, IBM, Dell, VMware, NetSuite, Salesforce, SPL WorldGroup, Meta, TOA Technologies, NetApp, PostgreSQL, Intel, Global Knowledge, Adobe, Computer Science Corporation, HP, Cognizant, Northrop Grumman, Google.

Who works at Oracle?

Safra A. Catz (CEO)

Lawrence J. Ellison (Chairman and Chief Technology Officer)

Ed Oates (Founder)

Robert Miner (Founder)

Vishal Sikka (Board Member)

Mark Trefgarne (Founder)

Seth van Sickel (Founder)

How does Oracle make money?

Oracle makes money by developing, creating, manufacturing, and selling software applications and programs, hardware products, and services. Oracle makes impressive amounts of profits from this business model. Here is a closer look at the ways Oracle makes money:

Oracle Company Values

Oracle’s company values reflect its commitment to integrity, customer satisfaction, mutual respect, quality, teamwork, fairness, communication, compliance, innovation, and ethics, which guide its decisions and actions on a daily basis. Oracle is a multinational technology company that specializes in developing and selling database software, cloud-based applications, and computer hardware.

Who owns Oracle?

Larry Ellison owns Oracle with a 42.4% stake in the company. Ellison co-founded Oracle with Bob Miner and Ed Oates, originally under the name Software Development Laboratories (SDL) in 1977. It changed its name officially to Oracle in 1995.

Have more questions? See all answers to common company questions.

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Most Common Locations At Oracle

• Oracle Annapolis Jobs
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Most Common Jobs At Oracle

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• User Experience Designer Oracle Jobs

Zippia gives an in-depth look into the details of Oracle, including salaries, political affiliations, employee data, and more, in order to inform job seekers about Oracle. The employee data is based on information from people who have self-reported their past or current employments at Oracle. The data on this page is also based on data sources collected from public and open data sources on the Internet and other locations, as well as proprietary data we licensed from other companies. Sources of data may include, but are not limited to, the BLS, company filings, estimates based on those filings, h2B filings, and other public and private datasets. While we have made attempts to ensure that the information displayed are correct, Zippia is not responsible for any errors or omissions or for the results obtained from the use of this information. None of the information on this page has been provided or approved by Oracle. The data presented on this page does not represent the view of Oracle and its employees or that of Zippia.

Oracle may also be known as or be related to Oracle, Oracle (China) Software Systems Co. Ltd., Oracle Corporation, The Oracle, oracle america, inc. , oracle usa, inc. and oracle india pvt. ltd.

What is a blockchain oracle? Everything you need to know

06/20/2022

AdvancedDeFiDecentralizationTechnical Basics

AdvancedDeFiDecentralizationTechnical Basics

#Band Protocol#Chainlink (LINK)#Blockchain Oracles

Essentials

• Blockchain oracles are algorithms that serve as a data link between a smart contract and a source outside the network where it is deployed.
• Oracle technology is widely used by decentralized applications in such areas as DeFi, GameFi, insurance, NFT and others.
• The largest blockchain oracle provider is Chainlink. Band Protocol, Berry Data, Kylin Protocol, DIA and other projects also work in this segment.

What problem do blockchain oracles solve?

Most operations in decentralized applications are performed using smart contracts. For their work, they may need a variety of data from external sources. For example, to calculate the exact ratio of the price of one cryptocurrency to another during the exchange.

Data from external sources – in particular, from platforms that aggregate trading data and prices from multiple exchanges – allows you to calculate the most “fair” price, as close as possible to the market.

However, the smart contract is unable to obtain information outside the blockchain on which it is deployed. It is here that oracles come to the rescue, performing an intermediary function between the contract and the data source it needs.

Blockchain oracles are algorithms that usually run on the nodes of a particular blockchain.

What are blockchain oracles?

Oracles are divided according to different criteria: the principle of operation, sources of data received and their direction, as well as the form of organization. Below are the most popular types.

Software and hardware

The first ones take data from digital sources: databases, servers, cloud storages, and broadcast it to the addressee in real time. Hardware collects data using physical devices: smart sensors, chips, barcode scanners, RFID tags, and so on

Incoming and outgoing

Oracles can have a specific specialization – either transmit information or receive from external sources. This may be necessary to increase the level of reliability and solve the problem of a single point of failure.

Centralized and decentralized

The centralized oracle is managed by a single operator who usually uses it in his own application. This type of oracle was the first to appear, however, due to problems with the vulnerabilities of such a system, the crypto industry gradually switched to the standard of decentralized blockchain oracles. These are systems that combine many oracles. A group of nodes is selected from it, each oracle of which performs its own “section” of the request. The first project that implemented the principle of decentralized blockchain oracles was Chainlink.

Contract-oriented

Expensive and time-consuming type, in which a separate oracle maintains a specific smart contract. If multiple smart contracts need to be deployed, then an equal number of oracles will need to be developed.

Cross-chain compatible

Services designed to transfer data between different blockchains. Solve the problem of network incompatibility with each other. Can be useful for decentralized applications that use cross-chain transactions, such as transferring one crypto asset to another.

Computational

Special oracles whose task is to perform resource-intensive calculations that are not practical to perform on the blockchain due to technical and financial limitations.

Where are blockchain oracles used?

Today, oracles in the crypto industry are used to transmit data streams, in particular price feeds. The latter are a table with a list of price values ​​for different dates and their source. Feeds allow smart contracts to receive cryptocurrency quotes from centralized trading platforms and trading aggregators.

For example, a blockchain oracle project called Band maintains reference prices for 75 cryptocurrencies as of June 2022, each with its own set of sources. For example, the Cosmos (ATOM) price is obtained by aggregating quotes from CoinGecko, CryptoCompare, CoinMarketCap, Binance, Huobi Pro, and Coinbase Pro.

Oracle technology is used in algorithmic stablecoins. One example is Ampleforth. The price of the AMPL stablecoin is supported by a rebalancing model (Rebase). In order to maintain a 1:1 dollar peg, the number of stablecoins in holders’ wallets is constantly changing in proportion to the market price of AMPL.

To do this, Chainlink oracles supply the Ampleforth protocol with aggregated data on the price of the AMPL/USD trading pair from several aggregators. In addition, the oracles also feed the protocol the current value of the US CPI obtained from official sources, which allows for dollar inflation to be taken into account when rebalancing.

Data sources are not limited to applications related to the crypto industry. Depending on the purpose of the program, where they are used, oracles can be connected to a source that provides, for example, statistics about the weather or the consumer price index in a particular country.

What other functions do blockchain oracles have?

Oracles can do more than just provide quotes. In Chainlink, it is possible to have a Verifiable Randomness Function (VRF) in application contracts where randomness is important, such as in blockchain games.

The Polychain Monsters project uses the VRF method to determine the contents of loot boxes, as well as to randomize the properties of the NFT token and choose the winner in airdrops.

Games also use VRF to create exciting and unpredictable gameplay, in particular to randomize the properties of game characters. In Aavegotchi, the user collects valuable crystals on the game map and participates in various mini-games with the help of “NFT ghosts” (Aavegotchi). When a member receives an Aavegotchi at the start of a game, they are assigned a random level via VRF.

What projects are developing blockchain oracles?

Chainlink is a recognized market leader in decentralized oracles. Its ecosystem includes over 1300 projects in the DeFi, NFT and Game-Fi sectors. Chainlink does not have its own network: the project deploys nodes in different blockchains, the applications in which it serves. Chainlink oracles operate on Solana, Ethereum and EVM compatible networks, including BNB Chain, Arbitrum, Optimism, Polygon, Avalanche and Fantom.

We can also highlight the Band Protocol, which has about 80 integrations. Unlike Chainlink, the project runs on its own BandChain blockchain created using the Cosmos SDK. Band also develops tools for WebAssembly developers that allow you to create oracles. BandChain is managed by a network of validators. Works with applications on Celo, Oasis and Cronos networks. The native coin of the project is BAND.

Other major oracle providers are:

• Berry Data is an oracle system on BNB Chain. When requesting off-chain data, Berry Data oracle operators compete to transfer data to a special “data bank” (Berry data bank) available to all applications on BNB Chain. In April 2022, there were about 170 integrations.
• DIA (Decentralized Information Asset) is a cross-chain compatible open source information platform that provides access to verified market data for decentralized applications. The project has its own DIA management token.
• Kylin Network is a decentralized oracle and data infrastructure platform for DeFi and Web3 based on the Polkadot Substrate framework.

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Oracles are objects that receive and protect external data for blockchains, allowing smart contracts to interact with external systems.

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Greco-Roman oracles of antiquity were said to have a special power to act as divine interpreters to enlighten the common people as to the inclinations of their gods. In the world of Web3 and blockchain-related technologies, oracles perform similar functions, but instead of trusting their words, blockchain oracles back up their data with evidence. That is, blockchain oracles are data-driven and protected by cryptographic primitives that provide maximum transparency and verifiable security.

Simply put, oracles are objects that serve as bridges from blockchain ecosystems to external data sources. Oracles rely on web APIs or other external sources for fresh data, since smart contracts do not natively perform these functions. Public blockchains record transactions and keep public copies of the history of the blockchain ledger. New transactions are confirmed in batches or blocks using various consensus mechanisms used by the participants of their nodes, and smart contracts allow trustless transactions to be easily executed and recorded in a public ledger.

Oracles secure blockchains and their external interactions by auditing and granting security clearances as data travels back and forth from hybrid smart contracts.

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Decentralized oracles add another layer of sophistication to this ecosystem by allowing for new kinds of hybrid smart contracts that ask for off-chain input to “know” when to execute. In this way, oracles facilitate interaction between smart contracts and the physical world, not to mention the legacy networks that make up global financial markets.

Through the interoperability and composability of different networks, the utility of blockchains and WEB3 dApps is greatly enhanced. Decentralized blockchains provide secure and transparent ledgers and histories, smart contracts facilitate complex interactions, and oracles connect it all to the real world. While this seems simple enough, as networks become more complex, several problems arise, such as the likelihood that oracles will become single points of failure, creating havoc if erroneous or stale data ends up in these deterministic and often immutable protocols.

The possibility that a single point of failure could create problems in smart contracts and the blockchains they run on is a serious mystery that has been discussed for quite some time. It is sometimes referred to as the oracle problem or “oracle dilemma” due to the difficulty of resolving the dilemma without sacrificing performance in the design and architecture of oracle protocols.

Oracle’s Dilemma

Simply put, smart contracts are executed based on input. If they only rely on the consensus of other nodes maintaining an internal ledger, this can be a source of strength since input validation can be done in a decentralized manner. “Trust” in external oracles complicates matters, since inputs cannot be verified “on the network” by consensus, but are passed from external sources verified by oracles. Thus, input from oracles must be correct if it is to be used for practical purposes such as identity verification, IoT sensors, insurance companies, not to mention finance and gaming.

Blockchains are inherently decentralized and thus provide security in part by reducing the likelihood of single points of failure. With distributed network nodes, the risk of damage to one or many nodes does not put the system at risk. However, this advantage can be negated if the data is routed through centralized oracles before it enters the blockchain. However, without access to external data that oracles, blockchains, decentralized applications and smart contracts provide, there would be far fewer use cases. This is a very obvious problem if the technology is scalable.

Oracles naturally have a significant impact on blockchains and dApps, as the data provided by oracles determines how their smart contracts are executed. Therefore, the need to trust these data flows to maintain the integrity of the system takes away the advantage of blockchains and their distributed networks by centralizing the data flows. Thus, if not taken care of, rudimentary oracle protocols effectively negate the distrust of decentralized networks, and even present a danger if pristine data is not kept up-to-date with minimal downtime.

If not properly decentralized, oracles can become attack vectors seeking to profit from manipulating network data bottlenecks.

These characteristics and their trade-offs will require some unpacking to understand the oracle problems awaiting solution through innovation. First, the authenticity and security of data must be verified in the same way as blockchains, through decentralized consensus rounds on newly formed blocks. Similarly, data needs to be updated frequently to keep it up to date.

As with blockchains, there are certain issues as the network scales, meaning that as oracle networks become more decentralized, consensus rounds take longer to complete and users find that their transactions do not go smoothly. if the network is congested. Not only does this result in poor performance and usability, but it also impacts the refresh rate and thus an increased chance of slippage if stale data is used to execute smart contract transactions.

In addition, the cost of constantly updating data, the oracle’s network nodes’ ability to maintain network uptime, and the bandwidth required to perform such complex tasks without failure pose significant challenges for developers. After all, it is fair to say that financial markets have never slept since digital asset trading began. Therefore, oracles must create critical redundancy to protect against network manipulation, downtime, future scaling and congestion issues, and black swan events.

“Therefore, the oracle’s dilemma must be resolved before Web3 completes the disruption of global finance and finally bridges the chasm from pioneers and early adopters to early adoption.”

If smart contracts can be created, canceled, or executed day and night, and these contracts use data from external sources, then the data streams themselves cannot be corrupted if smart contracts are to function properly and in a fair and honest manner. . That is, if Jill agrees to trade with Jack 1 Ethereum (ETH) for 2 ounces of tokenized digital gold (PAXG), then both Ethereum and gold prices must be carefully checked by oracles and transferred to the protocol or dApp on which Jack and Jill concluded their smart -Contract. Any deviation from market spot prices for any asset will ultimately leave one or both parties disappointed.

To illustrate this, imagine that Jack and Jill enter into an asset trading agreement when the market price of ETH was $4,000 and 1 ounce of gold was $2,000 (x2 ounces). Consider whether oracle nodes or the underlying blockchain network experienced performance issues during market volatility when the price of gold dropped from $1,900 to $2,100 and then back to $1,900 during early morning trading hours.

If ETH remained roughly stable at $4,000, Jack and Jill would expect their trade to be executed according to their agreement. However, because in our example, the oracle network failed to report the sudden volatility in the spot gold price in a timely manner, the trade is never executed and the protocol does not work properly. Perhaps this can be summed up as an extremely minor and inconsequential example of what can happen when oracles don’t work properly.

Judging by the current market capitalization of all crypto assets, there are literally trillions of dollars at stake, and even more in the form of borrowed funds. If capital is liquidated improperly, losses can be catastrophic and ripple effects can be felt financially, not to mention damage to the reputation of blockchains, smart contracts, and related Web3 technologies. Therefore, the oracle’s dilemma must be resolved before Web3 completes the destruction of global finance and finally bridges the chasm from pioneers and early adopters to early adopters.

Classification of oracles

Blockchains need to interact with external data in different ways, which means that oracles work differently to best meet these requirements. Hybrid smart contracts, or those that use off-chain resources for functionality, should not only process inputs and outputs from blockchains, but can also facilitate cross-chain communication as well as provide computational and randomization functions.

Of course, oracles can perform one, more, or all of the following functions, and so classifications of oracles should not be considered mutually exclusive. Therefore, let the following be an overlapping Venn diagram of oracle functions that either overlap or are interconnected:

Entrance oracles

Entry oracles are perhaps the most well-known variety as they extract and validate external data for use by hybrid smart contract protocols. Using distributed networks of nodes, oracle protocols typically ping summary data from APIs and other web sources, and this summary data is further aggregated in some way to produce a consensus number with an acceptable margin of error.

Output oracles

Supply chain management, IoT systems and banking networks can find use cases for sending data to signal the end of an event. For example, exit oracles will allow shipping companies to check the constant temperature of sensitive goods throughout their journey. What’s more, bike-sharing or car-sharing apps can use input and output oracles to signal payment and unlock the rental vehicle.

Internet Oracles

Over time, the number of users of blockchains and smart contracts has grown to impressive numbers. It is unlikely that any one blockchain will be used everywhere around the world. Hence, blockchains will inevitably need to interact with each other in order to interoperate. Cross-chain oracles not only increase the liquidity of Web3 protocols, but also serve to reduce competition and tribalism between different blockchain communities and instead encourage productive collaboration.

Cross-chain oracles mainly monitor the activities of different blockchains and report the conditions to other blockchains or token bridges. Token bridges, of course, allow crypto assets native to one blockchain to be traded as “wrapped tokens” on other blockchains. Oracles ensure that double spending or other manipulative actions do not occur without detection. Reserve audits can also be used to audit traditional off-grid assets, which will be detailed below.

Computing Oracles

Oracles perform functions other than extracting and validating external data, such as generating verifiable randomness calculations. This is often done when off-network randomness, known as verifiable random functions (VRF), must be computed due to network bandwidth limitations or economic impediments. VRFs are fair and transparent methods for generating random numbers for use in smart contracts on the web. For example, non-fungible tokens (NFTs) are often minted in sets of 10,000, with each user minting their NFT at random. Using oracles to generate these VRFs ensures that the minting process is random, fair, and provable through mathematical algorithms.

Oracles can also act as “software bots” to automate smart contract operations when certain events occur. For example, oracles can wait until your crop income reaches a certain dollar amount before withdrawing funds or transferring them to another protocol to maximize income. Oracles can also securely authenticate the validity of data using zero-knowledge proofs to maximize user privacy without sacrificing data security or exchange speed.

Use cases for decentralized oracles

DeFi and Proof of Reserves

Many centralized and decentralized crypto protocols require oracles to access data from external sources. Exchanges, money markets, and other protocols that use digital assets use oracles to determine reserves backing specific stablecoin assets, not to mention securing a borrower in the case of decentralized lending. Other assets that are pegged to external market spot prices use oracles to update prices, and automated money markets use oracles to fill limit orders using price aggregates from oracles.

Enterprise/supply chain management

Oracles also create opportunities for corporate brands and supply chain managers to connect external and internal systems to the blockchain networks of their choice. Of course, many will choose to use individual private blockchains, which will inevitably have practical needs requiring cross-chain compatibility and communication supported by oracles.

This is especially important because the cost of system interoperability has historically been measured by the high costs and security risks associated with exchanging sensitive data or providing access to internal processes. Therefore, large scale economists will be able to use their assets more efficiently and reduce counterparty risk as oracles secure data using powerful cryptographic primitives.

NFT and GameFi

Oracles also allow hybrid use cases for non-fungible tokens such as dynamic NFTs. NFTs are completely unique tokens minted on blockchains that can be exchanged between wallets and cannot be split or exchanged for anything else in kind. Dynamic NFTs can also change dynamically based on external events or achievements, such as the current weather, a score in a sports game, or unlocking a video game achievement.

As previously mentioned, computational oracles generate verifiable randomness that can be assigned by the NFT during minting, such as fur color, hat style, or background color. Computing oracles can also select random winners competing for exclusive NFT airdrops or other special editions. Blockchain games, and eventually metaverse protocols, will use computational oracles to generate randomness to create authentically fair competitions, rare item discoveries, and other random encounters.

Health and insurance

Insurance protocols will use input and output oracles to verify the occurrence of insurance claims during the claims process using web API, satellite imagery, IoT-style sensors, police and medical reports, and legal documentation before triggering payouts. Applications in agriculture, automobiles, homes, floods, fires, and insurance companies will find use cases for the hybrid smart contracts that oracles use to make it all possible. The Fraud Detection, Claims and Audit departments will soon have new tools and additional resources at their disposal that can be used to achieve high returns.