--- title: Oracle url: "https://www.unknowngravity.com/en/glosario/oraculo" site: Unknown Gravity published: "2025-06-07T15:15:39+00:00" modified: "2026-07-30T15:43:02+00:00" language: en-US description: "An Oracle in blockchain is an external system that provides real-world data to smart contracts, allowing them to execute automatic actions based on events or conditions that occur outside the…" section: "Home > Oracle" --- # Oracle GLOSSARY · BLOCKCHAIN & WEB3 An oracle feeds the smart contract the data the chain cannot see: a price, a result, a temperature, a shipment. Execution is only as good as that data feed. WHAT IS IT? · FOR DUMMIES An **oracle** is like a **messenger that connects the blockchain to the real world**. Smart contracts can't look off the chain on their own, so the oracle tells them things like the price of bitcoin, if it rained in a city or who won a game. This way they can make decisions based on current information. WHAT IS IT? · PRO An **Oracle** in blockchain is an **external system that provides real-world data to smart contracts**, allowing them to execute automatic actions based on events or conditions that occur outside the network. Since smart contracts are **closed by design and have no native access to external data sources**, oracles act like **communication bridges between the blockchain and the off-chain environment**. An oracle can provide information such as: - Asset prices (e.g. BTC/USD, ETH/USDT), - Sports or election results, - Meteorological data, - Logistic conditions in the supply chain, - IoT sensor states, - Identity signatures or KYC verification. There are different types of oracles: - **Software oracles**: extract data from APIs, web pages or digital sources. - **Hardware Oracles**: connect physical devices such as sensors or RFID. - **Entry oracles (inbound)**: they bring data from outside to the blockchain. - **Outbound oracles**: they allow the blockchain to send signals to the real world. - **Decentralized oracles**: such as Chainlink, Witnet or Band Protocol, which aggregate data from multiple sources to reduce the risk of manipulation. Its operation usually involves **cryptography, digital signatures, external consensus validation and reputation systems**, since oracles can become critical points of vulnerability if they are not well designed (known as the **“Oracle problem”**). In DeFi, gaming, security, tokenization and governance environments, oracles are key to creating **advanced conditional logic** and connect smart contracts with reality in real time. ## 01 / Key points - It's a bridge between blockchain and the real world - Provide external data to smart contracts - Allows you to activate automatic conditions based on off-chain information - It can be input, output, software, hardware or decentralized - Key to DeFi, Insurance, Prediction, Gaming, Identity and More ## 02 / Advantages - **Expand the potential of smart contracts** by making them dynamic - **Enables automation based on real events** and verifiable - **Supports a wide variety of sources and data types** - **Essential for advanced applications in DeFi, IoT, supply chain, etc.** - **Enables cross-chain interaction and with Web2 systems** ## 03 / Disadvantages - **Risk of centralization and data manipulation** If the source is not decentralized - **Critical Point of Failure** on contracts that depend 100% on the oracle - **Additional technical complexity** in data integration and validation - **Cost of accessing reliable and secure data**, especially in real time - **Requires incentive and reputational mechanisms to maintain integrity** RELATED CONCEPTS [Smart contract](/en/glosario/smart-contract) [Smart Contract](/en/glosario/smart-contract-contrato-inteligente) [Blockchain](/en/glosario/blockchain) [ZK Proof (Zero-Knowledge Proof)](/en/glosario/zk-proof-zero-knowledge-proof) [Token](/en/glosario/token) [Interoperability](/en/glosario/interoperabilidad) KEEP LEARNING [How to protect your digital assets in the cryptocurrency world](/en/articulos/como-proteger-tus-activos-digitales-criptomonedas) [Comparison of smart contracts programming languages](/en/articulos/lenguajes-programacion-smart-contracts) [What Do Blockchain Developers Do?](/en/articulos/que-hacen-los-desarrolladores-blockchain) [Tokenomics that work: How to design an economy that doesn't collapse in 6 months](/en/articulos/tokenomics-que-funcionan-como-disenar-una-economia-que-no-se-derrumbe-en-6-meses) [Blockchain use cases in the supply chain.](/en/articulos/casos-de-uso-de-blockchain-en-la-cadena-de-suministro) RELATED SERVICES [Development of smart contracts](/en/servicios/company-development-smart-contracts) [Web3 Development](/en/servicios/desarrollo-web3) [DeFi protocols](/en/servicios/protocolos-defi) [Blockchain consulting for companies](/en/servicios/consultoria-blockchain) [Smart contract auditing](/en/servicios/blockchain-security-audits) [Full glossary](/en/glosario) This entry is informative. It is not legal, tax or investment advice. The rules cited change: check the current version on [BOE](https://www.boe.es) and [EUR-Lex](https://eur-lex.europa.eu).