Oracle Machine Track: Exploring the Second Rise Curve

The Oracle Machine is a key service mechanism in blockchain systems, responsible for bringing off-chain data into smart contracts. Essentially, the core competitiveness of Oracle Machine projects is mainly reflected in four aspects: the comprehensiveness and credibility of data acquisition, the value capture of exclusive data, the security and decentralization of the verification mechanism, 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. Currently, Chainlink is the absolute leader in this field, with a wealth of data sources and extensive project collaborations. Pyth Network has advantages in transmission speed and financial data acquisition, while Redstone is currently the only Oracle Machine that supports both Push and Pull pricing methods.

In the future, the Oracle Machine will no longer overly rely on providing price feeds for DeFi projects. Real-world assets (RWA) are expected to become a strong second rise curve in the Oracle Machine track. In addition, emerging business areas such as the Internet of Things, artificial intelligence, and decentralized science also have the opportunity to combine with the data services of the Oracle Machine, bringing new growth momentum to the industry.

1. The Development History of the Oracle Machine

The concept of Oracle Machine was first proposed by Ethereum co-founder Vitalik Buterin in 2015, emphasizing its key role in smart contracts obtaining external data. In the same year, Oraclize(, now known as Provable), launched the first decentralized oracle service.

In 2017, the Chainlink project was established, proposing the concept of a decentralized Oracle Machine network (DON), aimed at solving the single point of failure problem. During the DeFi Summer of 2020, oracles emerged as the core external data service providers for DeFi, leading to an explosion in demand. Subsequently, projects like Band Protocol and Tellor were launched, marking the initial emergence of a competitive landscape.

In 2022-2023, Oracle Machine services expanded to multi-chain and multi-scenario. Chainlink launched the cross-chain interoperability protocol (CCIP), supporting cross-chain data transmission and smart contract interaction. The Pyth Network mainnet went live, attracting participation from several traditional financial institutions.

In 2024-2025, Oracle Machine services will expand from DeFi to fields such as gaming, NFTs, and insurance. IoT applications will create more demand for Oracle Machines, and AI will explore new scenarios for automated execution of smart contracts in conjunction with Oracle Machines.

2. Oracle Machine Track Market Size

By the end of 2024, the total market value of the Oracle Machine project will be $10.55 billion, accounting for 11.8% of the total market value of DeFi. According to Grand View Research's forecast for the DeFi market, the market value of DeFi is expected to reach $231 billion by 2030. Based on this, this article calculates the market space of Oracle Machine under two scenarios:

• Optimistic scenario: The Oracle Machine market size maintains 10% of the DeFi market size, reaching $23.1 billion 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. Main Projects in the Oracle Machine Track

3.1 Chainlink

Chainlink is the absolute leader in the Oracle Machine sector, providing services such as price feeds, automation, verifiable random functions, and cross-chain operations. In 2024, revenue from price feed services accounts for 95% of the project's income, with DeFi protocols being the main service targets.

Chainlink's price feed service obtains data from multiple data aggregators through several independent nodes, aggregates and cleans the data before submitting it on-chain. In addition, Chainlink also offers products such as the automated service Keeper, the cross-chain interoperability protocol CCIP, and the Verifiable Random Function VRF.

3.2 Pyth Network

Pyth Network was launched in 2021 and is a key project supported by the Solana ecosystem. Its main advantages are a fast data update frequency and support for 65 public chains. Pyth's interaction numbers on the Solana chain have already formed a certain barrier.

3.3 Redstone

Redstone is currently the only data provider that employs both Push and Pull modes, having completed integration with over 70 public chains. Redstone has also launched the AI Oracle Machine architecture CLARA, leading the exploration in the AI field.

4. RWA Opens the Second Rise Curve of the Oracle Machine Track

As the "data bridge" of the DeFi ecosystem, the Oracle Machine is deeply connected to the rapid rise of the industry. However, as the penetration rate of the DeFi market approaches saturation, the limitations of over-reliance on a single scenario are gradually becoming apparent. The demand for Oracle Machines regarding RWA is more complex, including both asset valuation and real-time tracking and on-chain synchronization of physical asset status.

Current mainstream Oracle Machine projects have begun to layout in the RWA field:

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

For non-financial assets ( such as real estate, charging piles, photovoltaic components, etc. ), the Oracle Machine needs to provide more complex services, including connecting to data sources that reflect the asset status and influencing factors, and combining mathematical models to convert the information into reliable on-chain prices or risk assessments.

5. Multi-type Data Specific Oracle Machine, Industry rise curve from 2 to N

As on-chain demand expands, particularly with the increasing complexity of off-chain data requirements in emerging scenarios such as RWA, the Internet of Things, AI, and decentralized science, the service capabilities of Oracle Machines are shifting from "generalized transmission" to "vertical processing".

5.1 Internet of Things Data Oracle Machine

The IoT Oracle Machine allows device users to monitor device data in real-time. BoAT3 is an Oracle Machine paradigm based on IoT data, which uploads the completed workload to the chain through PoPow( physical proof of work). Echolink is one of the few Oracle Machines designed for IoT, having completed connections for approximately 8 million hardware devices.

5.2 Code Oracle Machine

With the rise of AI and blockchain integration projects like Bittensor, there may be dedicated Oracles in the future that upload off-chain code to the chain. These Oracles can be used in scenarios such as smart contract vulnerability checks, helping to improve code auditing efficiency and security.

5.3 Biological Macromolecule Oracle Machine

With the rise of decentralized science ( DeSci ) concept, there may be dedicated Oracles in the future for uploading clinical trial data of biomolecules. These Oracles can help on-chain investors better assess the value of biopharmaceutical projects.

Conclusion

The Oracle Machine is gradually evolving from a "universal data layer" that serves standardized financial protocols to a "multimodal infrastructure" that supports vertical scenarios. RWA is expected to become the main second rise curve in the Oracle Machine track, while dedicated oracles in fields such as IoT, AI, and life sciences will continue to emerge. In the future, with the increasing demand for more modal data on-chain and the improvement of smart contract performance, the Oracle Machine industry will welcome new development opportunities.