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<p>Blockchain technology is poised to transform various industries, including finance, global trade, insurance, gaming, and more. With the potential for trillions of dollars of assets to transact on-chain, it’s increasingly crucial to connect blockchains to the real world.&nbsp;</p>



<p>This is where blockchain oracles come into play.&nbsp;</p>



<p>In this investor’s guide, we will explore the concept of blockchain oracles, their significance in the creation of the verifiable web, and the various types of oracles used in different applications.&nbsp;</p>



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<h2 class="wp-block-heading">Blockchain oracles free smart contracts from inherent limitations</h2>



<p>Smart contracts, on their own, can’t interact with data that exists outside of their blockchain environment, presenting what is commonly referred to as “<a href="https://chain.link/education-hub/oracle-problem">the blockchain oracle problem</a>.”</p>



<p>Oracles function as the solution to this problem, facilitating the creation of hybrid smart contracts, which combine on-chain code with off-chain infrastructure. The hybrid structure enables smart contracts to access real-world data and events.&nbsp;</p>



<p>This access drastically expands the use cases of smart contracts, proving oracles are vital to the global expansion of blockchain technology.</p>



<h2 class="wp-block-heading">The diverse flavors of blockchain oracles</h2>



<p>A variety of different blockchain oracles exist, serving various needs across the blockchain industry. Let’s go over some of the most prevalent.</p>



<p><strong>Inbound &amp; outbound oracles</strong></p>



<p>Inbound oracles fetch data from the real world and deliver it to the blockchain. They’re used for apps that require access to real-time data, like price feeds for DeFi platforms or odds for sports betting platforms. </p>



<p>Outbound oracles, on the other hand, enable smart contracts to send commands to off-chain systems. These oracles could, for example, inform a bank’s network to make a payment&nbsp;</p>



<p><strong>Hardware &amp; software oracles</strong></p>



<p>Hardware oracles interact directly with the physical world to gather data from external devices or sensors. These devices can range from simple temperature sensors to complex systems for tracking supply chain movements or environmental conditions. The primary function of hardware oracles is to bridge the gap between the digital and physical worlds, enabling smart contracts to execute based on real-world events and conditions.&nbsp;</p>



<p>Software oracles, in contrast, collect data from online sources, such as databases, websites, and other digital platforms. They play a crucial role in connecting blockchain systems with the vast amounts of data available on the internet, allowing smart contracts to react to information such as stock prices, election results, or online transaction outcomes.</p>



<h2 class="wp-block-heading">Current examples of oracle projects</h2>



<p>A robust roster of oracle providers are currently serving the Web3 industry. Here is a brief overview of providers that expand across multiple ecosystems that you should be aware of:</p>



<h3 class="wp-block-heading">Chainlink</h3>



<p><a href="http://chain.link/">Chainlink</a> is the industry-standard decentralized computing platform powering the verifiable web. Chainlink has safeguarded <a href="https://defillama.com/oracles/Chainlink">over $17.3 billion</a> in total value secured (TVS) on-chain by providing financial institutions, startups, and developers worldwide with access to real-world data, off-chain computation, and secure cross-chain interoperability across any blockchain. Chainlink powers verifiable applications and high-integrity markets for banking, DeFi, global trade, gaming, and other major sectors.</p>



<h3 class="wp-block-heading">Switchboard</h3>



<p><a href="https://docs.switchboard.xyz/">Switchboard</a> is an exciting project creating waves in the Solana blockchain ecosystem. With a TVS of <a href="https://defillama.com/oracles/Switchboard" target="_blank" rel="noreferrer noopener">more than $1 billion</a> as of the time of writing, Switchboard’s architecture delivers on-demand and push-based data feeds, making it essential for projects building around the DeFi, gaming, and NFT spaces. Another feature of Switchboard is its ability to allow developers to customize their interactions with data, ensuring a fit for different project requirements. Additionally, Switchboard includes a secret management mechanism to guarantee sensitive data is properly secured in smart contracts. Beyond Solana, Switchboard envisions an interoperable multi-chain oracle future, with support for Aptos, Sui, Starknet, CoreDao, and Arbitrum already in place, as well as support for additional chains such as Ethereum, Optimism, Monad, Eclipse, and more in the pipeline.</p>



<h3 class="wp-block-heading">Gora</h3>



<p>Tens of thousands of businesses are beginning to use sensor and IoT data to verify reports and share information, especially in areas like manufacturing, logistics, and environmental monitoring. <a href="https://www.gora.io/">Gora</a> stands at the forefront of integrating sensor and IoT data within the blockchain ecosystem, aiming to capture significant market share in these rapidly growing markets. Furthermore, Gora is utilizing Decentralized Physical Infrastructure Network (DePIN) technologies to create unique verifiable credentials (VC) functionality, which is expected to have a significant impact on everything from decentralized KYC and anti-money laundering processes to verification of source of goods and creative content.</p>



<h3 class="wp-block-heading">Flare</h3>



<p><a href="https://flare.network/">Flare</a> is an EVM-compatible &#8220;blockchain for data,&#8221; specifically designed to support the intensive data demands of emerging use cases, including <a href="https://arxiv.org/pdf/2402.16157.pdf">machine learning</a> and DeFi with real-world assets. Google Cloud and InfStones are the latest additions to the Flare family, responsible for both securing the network as validators and contributing to the network’s decentralized data oracles. Enshrining oracles at the network layer in this manner means they inherit the security and decentralization of layer 1. This enables Flare to offer builders decentralized access to the broadest range of low latency data, at scale, and for minimal cost &#8211; supporting the development of more sophisticated dapps with greater real-world relevance.</p>



<h3 class="wp-block-heading">Stork</h3>



<p><a href="https://www.stork.network/">Stork Network</a> is a high-performance, modular oracle that pioneered a hybrid oracle architecture and can <a href="https://infstones.com/news/announcements/infstones-collaborates-with-stork-to-run-oracles-for-its-network-6375115418df2833d18dc4f9">provide data updated at the millisecond level</a> to decentralized exchanges and other partners. It combines off-chain data gathering with cryptographic signatures, enabling ultra-low latency and prioritizing data reliability and verifiability on-chain. Stork provides an extensive data catalog, including specialized feeds like index and mark prices, and prides itself on its resilient uptime. Interoperability is another critical feature of Stork&#8217;s technology, with prices signed in a manner compatible across different blockchains. In Q4 2023, Stork secured over $43 billion in volume across decentralized derivatives. Stork&#8217;s <a href="https://www.coindesk.com/business/2024/01/18/sui-teams-up-with-oracle-stork-to-provide-builders-with-fast-pricing-data/">collaboration with the Sui Foundation</a> also underlines its commitment to enhancing the DeFi derivatives market.</p>



<h2 class="wp-block-heading">Real-world use cases for blockchain oracles</h2>



<p>Today, oracles carry unique features designed for specific application areas outside their most common use cases. But even more exciting is what’s coming next for oracles. Here are some examples of how oracles are impacting the world through real use cases today, as well as what the future holds for the technology.</p>



<h3 class="wp-block-heading">Gora’s impact on traditional industries</h3>



<p>Gora’s focus on IoT data makes it well-optimized for traditional industries like automotive, logistics, and oil and gas. As means of production have grown increasingly complex, with much of the processes across these industries happening out of sight, consumers, regulators, and investors are pushing companies for more transparency.&nbsp;</p>



<p>Gora&#8217;s distributed node network is designed to accelerate and enhance the digital transformation of organizations by offering the essential tools for executing bespoke use cases required by these entities, significantly reducing the time and costs associated with getting started. Whether an oil and gas company wants to track carbon emissions or a boat manufacturing company verifiably wants to improve its processes with better data, Gora&#8217;s platform serves as the foundational layer upon which these applications can be developed.</p>



<h3 class="wp-block-heading">Flare enabling data-driven dapps</h3>



<p>Flare has amassed a thriving ecosystem, boasting over 150 partners and builders across the NFT, DeFi, and metaverse sectors of Web3. <a href="https://www.pangolin.exchange/">Pangolin</a>, for example, is a decentralized digital assets exchange (DEX) that facilitated over $15 billion in trading volume in its first year. <a href="https://www.elliptic.co/">Elliptic</a> offers the world’s largest blockchain identity dataset, enabling the world’s leading organizations to gain a holistic view of risk in crypto ecosystems to manage risk and detect crime.</p>



<h3 class="wp-block-heading">Switchboard’s versatility across sectors</h3>



<p>Switchboard enables on-demand and push-based data feeds, making it perfect for prediction markets using weather and sports data, for example.&nbsp;</p>



<p>The team has recently deployed its <a href="https://x.com/switchboardxyz/status/1757458655572898225?s=20">Switchboard Randomness Service (SRS)</a>, enhancing the integrity (through on-chain verification) of randomness-based products including gaming and potentially sensitive applications like gambling. Notably, it’s currently being leveraged in <a href="https://x.com/FamousFoxFed/status/1749181279776493592?s=20">Famous Fox Federation’s Fortuna</a> application, a collection of on-chain games where users can spend SOL to win prizes.</p>



<h2 class="wp-block-heading">What’s next for oracles</h2>



<p>One of the most promising applications of blockchain oracles lies in driving sustainability initiatives. By supplying environmental data to smart contracts, oracles play a pivotal role in fostering eco-friendly behaviors. For instance, individuals could receive incentives for engaging in environmentally sustainable practices, such as reducing energy consumption or participating in recycling programs.&nbsp;</p>



<p>In the real estate domain, blockchain oracles are revolutionizing traditional processes. They’ll direct the submission of crucial legal documents to smart contracts, streamlining transactions, and reducing manual errors. They also have the power to greatly improve access to real-time property price data by aggregating and verifying information from various sources, leading to more informed decisions and benefiting all stakeholders in real estate transactions. For example, Chainlink’s <a href="https://chain.link/cross-chain">Cross-Chain Interoperability Protocol</a> (CCIP) introduces a standard for secure and decentralized cross-chain communication, promoting further development in this domain. The Oracle landscape is evolving, and more innovative projects are emerging, with notable mentions including the Pyth Network and Chronicle. Pyth boosts DeFi applications with precise and low-latency market data from institutional sources. In contrast, Chronicle offers substantial gas fee reductions (over 60% on Layer 1 and 68% on Layer 2) and guarantees data transparency.</p>



<p>In the insurance industry, oracles could revolutionize process flows for end users by automating claims and payouts. In the event of an insurable incident, an oracle could automatically verify the occurrence using data from various sources, such as weather reports or car monitors. This data, once processed and confirmed by the oracle, could trigger a smart contract to initiate an insurance payout. This automation not only enhances the efficiency of claim processing but also reduces the likelihood of fraudulent claims, thereby benefiting both the insurer and the insured.</p>



<h2 class="wp-block-heading">Enhancing real-world connectivity with blockchain oracles</h2>



<p>Blockchain oracles have emerged as a critical component in linking blockchain technology with real-world applications. By overcoming the limitations of smart contracts, they empower these digital agreements to interact with and react to external data, facilitating a myriad of practical uses. From financial services to environmental sustainability, the role of oracles in broadening the scope and functionality of blockchain applications is undeniable.</p>



<p>Looking to develop or integrate a blockchain oracle? <a href="https://infstones.com/?utm_source=blockworks&amp;utm_medium=partner&amp;utm_campaign=blockworks+investor+guide">The InfStones platform</a> provides unparalleled infrastructure support and expertise. InfStones is a trusted partner for many decentralized oracles and industry leaders such as Binance, Circle, OKX, Lido, and Swell. With support for over 80 blockchain protocols and frequent expansions, InfStones stands as a comprehensive resource for all your blockchain-related needs.</p>



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InfStones

Blockchain oracles: Bridging the gap between blockchains and the real world

Sebastian Sinclair

<div id="highlights-block_62e86f3fa094d" class="highlights">
        <ul>
                <li>Oracle, the world&#8217;s third largest software company by revenue, has tapped infrastructure provider InfStones to compliment its blockchain suite of offerings</li>
                <li>It comes as major tech firms implementing blockchain face profitability headaches amid rising inflation</li>
            </ul>
    
</div>



<p>Oracle, one of the world&#8217;s largest software companies, has teamed up with a budding blockchain infrastructure provider to deliver a scalable Web3 infrastructure development platform for their shared enterprise customers.</p>



<p>Provider InfStones said Tuesday it has teamed up with Oracle in a bid to accelerate the new iteration of the internet.</p>



<p>While Oracle is no stranger to blockchain — having unveiled its enterprise-grade blockchain platform&nbsp;back in July 2018 — its collaboration with InfStones represents a growing trend in Web3 infrastructure development.</p>



<p>Despite that trend, large tech firms adopting blockchain-related technology, such as Google, Meta and Microsoft, could be facing profitability headaches amid mountain inflation, according to an analysis by <a href="https://www.forbes.com/sites/javierpaz/2022/05/12/the-worlds-largest-tech-companies-embracing-blockchain-face-a-valuation-reckoning/?sh=29c3ea26fe8e" target="_blank" rel="noreferrer noopener">Forbes</a> in May.</p>



<p>Oracle said the combination of its platforms running atop Oracle&#8217;s Cloud Infrastructure will reduce barriers to entry for new companies looking to incorporate distributed ledgers into their stacks.</p>



<p>Amazon Web Services and Microsoft Azure also offer &#8220;Blockchain-as-a-Service&#8221; platforms. These allow companies to run tailored permissioned (private) blockchain networks hosted by the tech giants.</p>



<p>“Partnering with Oracle Cloud&nbsp;Infrastructure offers enterprise customers a robust cloud infrastructure across OCI&#8217;s multiple regions worldwide,&#8221; InfStones&#8217; CEO Zhenwu Shi said in a statement.</p>



<p>Oracle said it will work with InfStones to bring its enterprise blockchain customers to more verticals and builders across the Web3 development ecosystem. Shi previously <a href="https://www.linkedin.com/in/zhenwu-shi-32a1376b/" target="_blank" rel="noreferrer noopener">worked</a> as a senior software engineer at Oracle. </p>



<p>Established in&nbsp;2018 as a staking and infrastructure platform providing services to institutional clients, InfStones has since grown to include a node management platform for users alongside an integrated API offering, allowing developers to build applications on blockchain networks such as Polygon, Solana and Chainlink.</p>



<p>InfStones, headquartered in North Texas, counts crypto-native clients including Binance, Circle and Compound. The firm <a href="https://techcrunch.com/2022/06/01/softbank-co-led-66-million-round-for-blockchain-focused-infstones/" target="_blank" rel="noreferrer noopener">closed</a> a $66 million funding in June co-led by SoftBank, and <a href="https://www.dallasnews.com/business/technology/2022/06/01/plano-crypto-company-infstones-near-unicorn-status-after-66-million-funding-round/" target="_blank" rel="noreferrer noopener">said</a> the round valued it at nearly $1 billion.</p>



<p>“The power of the InfStones platform and Oracle&#8217;s next-generation cloud infrastructure provides our joint customers with an extremely performant, reliable and secure platform for developing decentralized Web3 applications,” said Chris Gandolfo, senior vice president of cloud venture, Oracle.&nbsp;</p>



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blockchain

Software Giant Oracle Teams With InfStones for Web3 Development

<div id="highlights-block_6296b90c9be0f" class="highlights">
        <ul>
                <li>The round was led by SoftBank Vision Fund 2 and GV Capital, the investment arm of Google parent Alphabet Inc.</li>
                <li>The extended round follows its Series B in February in which it managed to pick up a further $33 million in fresh capital</li>
            </ul>
    
</div>



<p>Blockchain infrastructure provider InfStones said it has edged closer to “unicorn status” with this latest funding round of an extended Series B, which saw the firm pick up a further $66 million.</p>



<p>The round was led by SoftBank Vision Fund 2 — one of the world&#8217;s largest technology-focused investment funds — and GV Capital, the investment arm of Google parent Alphabet Inc.</p>



<p>Participation in the round also came via venture capital firms INCE Capital and SNZ Holding as well as venture funds 10T Fund and A&amp;T Capital. A representative from InfStones was not immediately available for comment on its post-money company valuation to date.</p>



<p>The fresh injection of capital will be used for enterprise-wide expansion and to accelerate growth, according to a company statement shared with Blockworks on Wednesday. That includes growing the firm&#8217;s team and its offerings, an expansion into new markets, and acquisition efforts.</p>



<p>“Our vision is to provide a rugged, easy-to-use Web3 environment to build a more transparent, intelligent world,” InfStones CEO Zhenwu Shi said in the statement. “We intend to drive rapid adoption of Web3 decentralized applications worldwide.”</p>



<p>InfStones&#8217; latest raise follows on from its Series B raise in February in which the firm managed to pick up $33 million to further develop its platform. The company also had a $10 million Series A raise in August of last year, bringing InfStones&#8217; total funding to roughly $109 million to date.</p>



<p>InfStones was founded in 2018 as a staking and infrastructure platform, providing services to institutional clients.</p>



<p>The company dubs itself as a &#8220;Platform-as-a-Service,&#8221; supplying blockchain infrastructure to Web3 innovators while boasting support to over 10,000 nodes on a &#8220;rapidly growing&#8221; list of blockchains including Ethereum, Chainlink, Polkadot, Cardano and Solana.</p>



<p>“InfStones provides the foundational infrastructure layer for the Web3 era, offering an enterprise-grade node management and staking platform that makes it painless for customers to participate in Web3 and DeFi,” Dennis Chang, managing partner at Softbank Investment Advisers, said.</p>



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Funding

Blockchain Infrastructure Provider InfStones Nabs $66M in Extended Funding Round

Jacquelyn Melinek

<div id="highlights-block_6217a432fd94b" class="highlights">
        <ul>
                <li>InfStones supports nodes on over 50 chains including Ethereum, Polygon, Solana, Polkadot, Cardano and Chainlink</li>
                <li>The platform’s customers include Binance, Dune Analytics, Polygon, Circle and Compound</li>
            </ul>
    
</div>



<p>Blockchain infrastructure provider InfStones closed a $33 million Series B round to further develop its platform, Zhenwu Shi, founder and CEO of the firm, said to Blockworks.</p>



<p>The round included investors from Susquehanna International Group (SIG), Dragonfly Capital, Qiming Venture Partners, DHVC, A&amp;T and Value Internet Fund.&nbsp;</p>



<p>The company previously raised $12 million in its seed round and Series A, bringing its total funding to $45 million. Shi declined to disclose a valuation.</p>



<p>With the new funding, the company plans to triple its team from 30 to 90 employees over the next year and expand support to over 100 chains and protocols.</p>



<p>InfStones was founded in 2018 and is a staking and infrastructure platform that provides services for institutional clients and supports nodes on over 50 chains, including Ethereum, Polygon, <a href="https://cms.blockworks.co/what-is-solana-everything-you-need-to-know-about-the-ethereum-rival/" target="_blank" rel="noreferrer noopener">Solana</a>, <a href="https://cms.blockworks.co/coinshare-launches-new-etps/" target="_blank" rel="noreferrer noopener">Polkadot</a>, <a href="https://cms.blockworks.co/cardano-polkadot-etps-hit-frankfurt-stock-exchange/" target="_blank" rel="noreferrer noopener">Cardano</a> and Chainlink.</p>



<p>“Demand for our infrastructure platform service has been very strong,” Shi said. “InfStones has been profitable from day one.”</p>



<p>The platform’s customers include <a href="https://cms.blockworks.co/crypto-exchange-binance-receives-200m-stake-in-forbes/" target="_blank" rel="noreferrer noopener">Binance</a>, <a href="https://cms.blockworks.co/web3-data-firm-dune-analytics-hits-unicorn-status/" target="_blank" rel="noreferrer noopener">Dune Analytics</a>, <a href="https://cms.blockworks.co/polygon-closes-450m-raise-led-by-sequoia-india/" target="_blank" rel="noreferrer noopener">Polygon</a>, Circle and Compound, among others, he noted.</p>



<p>“As Web3 technology and applications grow, data structure and architecture will become more and more decentralized,” Shi said.</p>



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow"><p><strong>“Web3 applications are not intuitively easy to use or develop, so the Web3 ecosystem requires an AWS-like layer solution to increase the speed and growth of Web3 adoption.”</strong></p></blockquote>



<p>In addition to the capital raise, the provider is launching a new front-end user interface that lets users deploy nodes within minutes, it said. The public application programming interface (API) is available for Ethereum, Neo, <a href="https://cms.blockworks.co/in-overture-to-decentralization-binance-rebrands-its-blockchain/" target="_blank" rel="noreferrer noopener">BNB Chain</a> — formerly known as Binance Smart Chain, or BSC — and BSC Archival Data. It plans to add support for Cosmos and other chains in the future.</p>



<p>The API will continue to add features that give developers full automation, fast deployment and multi-cloud support, Shi said.&nbsp;</p>



<p>Going forward, the provider will focus on further developing the blockchain platform to become the “preferred AWS of Web3,” Shi said.</p>



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