Oracle Machine Track: Finding the Second Rise Curve

The Oracle Machine is a key infrastructure in blockchain systems, used to bring off-chain data into smart contracts. Essentially, the core competitiveness of Oracle Machine projects is mainly reflected in four aspects: the comprehensiveness and reliability of data acquisition, the acquisition of exclusive data and value capture, the security and decentralization of verification mechanisms, and the transmission efficiency and network robustness.

It is expected that by 2030, the overall market size of the Oracle Machine sector will be between 13.8 billion and 23.1 billion USD. Currently, Chainlink is the absolute leader in the Oracle Machine sector, with a wealth of data sources and extensive project collaborations. Pyth has advantages in transmission speed and the acquisition of financial data. Redstone is currently the only Oracle Machine that offers both Push and Pull pricing methods.

In the future, the Oracle Machine will no longer overly rely on providing pricing services for DeFi projects, and RWA is expected to become a strong second rise curve in the Oracle Machine track. In addition, emerging businesses such as DePIN, AI, and DeSci also have the opportunity to combine with the data services of the Oracle Machine, becoming new driving forces for the revenue growth of the Oracle Machine, pushing the industry growth from 2 to N.

1. The Development History of Oracle Machine

2014 and earlier: The demand for Oracle Machines began to emerge. Projects like Augur started exploring decentralized prediction markets.

2015-2016: Ethereum co-founder Vitalik Buterin proposed the concept of Oracle Machine. Oraclize( now launched the first decentralized Oracle Machine service as Provable).

2017-2018: The Chainlink project was established, proposing the concept of a decentralized Oracle Machine network (DON).

2019-2021: The DeFi Summer arrives, and the demand for Oracle Machines explodes. Projects such as Band Protocol and Tellor are successively launched.

2022-2023: Oracle Machine expands to multi-chain and multi-scenario. Chainlink launches cross-chain interoperability protocol (CCIP). Pyth Network mainnet goes live.

2024-2025: Oracle Machine services expand from DeFi to areas such as gaming, NFTs, insurance, etc. The demand for IoT oracle machines increases with DePIN applications. AI combines with oracle machines to explore new scenarios.

2. Oracle Machine Track Market Size

By the end of 2024, the total market value of the Oracle Machine projects will be $10.55 billion, accounting for 11.8% of the total market value of DeFi. Based on Grand View Research's forecast for the DeFi market, this article presents two hypothetical scenarios to estimate the market space for Oracle Machine.

• Optimistic scenario: The Oracle Machine market size maintains 10% of the DeFi market size, reaching 23.1 billion USD by 2030.

• Neutral scenario: The Oracle Machine market size will remain at 6-8% of the DeFi market size, reaching $13.8-18.4 billion by 2030.

3. Major Projects in the Oracle Machine Track

3.1 Chainlink

Chainlink is the absolute leader in the Oracle Machine track. Its main services include:

1. Price feeding service: Obtain data from high-quality data aggregators through multiple independent nodes to achieve the on-chain transmission of price data.

2. Automation Services: Keeper and Automation 2.0 enable the automated execution of smart contracts.

3. Cross-Chain Protocol: CCIP provides smart contract developers with cross-chain data transmission and interaction capabilities.

4. Verifiable Random Function: Generates verifiable random numbers, widely used in scenarios such as gaming.

5. Enterprise Privacy Data Service: Providing on-chain and transaction services for enterprise privacy data.

3.2 Pyth Network

The main advantages of Pyth Network are low latency and financial data acquisition. Its products include:

1. Price feeding service: Provide corresponding SDKs for different types of public chains.

2. Random Number Generation Service: Pyth Entropy can quickly generate random numbers.

3. Fast Relay Service: Express Relay aims to eliminate on-chain MEV.

3.3 Redstone

Redstone is currently the only data provider that uses both Push and Pull modes. Its main products include:

1. Push Model: Push data to the chain through off-chain relayers.

2. Pulling the model: The on-chain smart contract actively calls the Oracle Machine interface to obtain the latest data.

3. AI Oracle Machine Architecture CLARA: Achieve seamless communication between agents.

4. RWA opens the second rise curve of the Oracle Machine track

RWA( Real World Assets ) have a more complex demand for Oracle Machines, including asset valuation and real-time tracking of physical asset status. Currently, several Oracle Machine projects have started to layout in the RWA field:

• Chainlink supports Backed Finance's partially tokenized RWA pricing.
• Redstone introduces Eurozone government bond ETF data source to the crypto world.
• Pyth Network provides pricing services for the RWA platform Ondo Finance.
• Supra public chain's DORA 2.0 provides RWA pricing services
• Chronicle Labs launched the RWA Oracle Machine "The Verified Asset Oracle"

For non-financial assets, the Oracle Machine needs to provide more complex services, such as accessing data sources that reflect asset status and influencing factors, and integrating mathematical models to convert information into credible on-chain prices or risk assessments.

5. Multi-Type Data Dedicated Oracle Machine, Industry rise Curve from 2 to N

The Oracle Machine service is transitioning from "generalized transmission" to "vertical processing", building dedicated systems for specific types of data. The main directions include:

1. IoT Data Oracle Machine: Supports DePIN capacity expansion, such as Echolink has completed the connection of about 8 million hardware devices.

2. Code Oracle Machine: Can be used in scenarios such as smart contract vulnerability checks, with potential applications like code audits for Uniswap.

3. Biomolecular Oracle Machine: Providing infrastructure for Crypto × Biotech, supporting on-chain financing and evaluation of biopharmaceutical projects.

As the integration of blockchain and the real world deepens, Oracle Machines will face both opportunities and challenges in processing various modal data. RWA is expected to become the main second rise curve in the Oracle Machine track, while vertical specialized Oracle Machine startup projects will continue to emerge, driving the industry from "unified pricing" to a new stage of parallel development of "multi-type specialized Oracle Machines."