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Oracle

An “oracle” smart contract is a hybrid smart contract that allows for off-chain data to be used on-chain. It acts as a bridge between a blockchain and any off-chain external environment. They are usually part of a larger oracle network that enables protocols to source, verify, and transmit information. An oracle framework is usually made up of at minimum two smart contracts. One that is on-chain that receives requests from users or other smart contracts and passes this data to an off-chain oracle node. The off-chain node gathers the relevant information and sends it back to the on-chain smart contract where the data is stored in the contract’s storage and broadcast to client contracts. There are many use cases for oracles within DeFi and other ecosystems, particularly in relation to the given market price of a token at a specific time.

Note: These are non-technical definitions meant for a general audience and should not be used as legal definition
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