How HUMAN is used as a DeFi oracle
The HUMAN Protocol Foundation has begun work in DeFi. The work on data labeling will continue, but the Foundation will increase focus on providing a suite of oracles to increase the decentralization and robustness of DeFi protocols.
We’ve already begun work with Pyth, a DeFi oracle provider, to offer our job-launcher and work verification technology to power DeFi data feeds. Check out their whitepaper to see just how HUMAN Protocol will work with them!
Oracle failures can be massive. For instance, a trading bot acted on a price oracle relaying the price of KRW as 1000x higher than was true, and ended up winning out $1 billion from Synetix. This is just one example – there are many more, which clarify the need for a secure, robust oracle infrastructure in DeFi.
Oracles are fundamental to blockchains – to their functioning, their integrity, and success. A blockchain with faulty, poor, compromised, or centralized oracles, loses the very purpose of its design as a distributed network.
Oracles provide and record data from external sources to smart contracts on-chain; they are a critical component of smart contract execution. Because oracles can be used to pull any real-world data on-chain, they can massively expand the utility of blockchains. They do, however, also pose a risk as a point of failure, a point of reliance – particularly as the blockchain has to “trust” the data it receives.
In using HUMAN Protocol to power an oracle — the process is as follows:
The primary use case in this scenario would be for arbitration of disputes. Dispute management is something that robust decentralized protocols must implement if they are to be truly trusted. If, in DeFi protocol, two parties disagree that the price pairing of USDC:USDT was not precisely 0.9999967, then having a recourse, whereby a group of human workers can singularly and independently check that information and relay it on-chain, is valuable.
The entire ecosystem of DeFi relies upon reliable price information. Below are just a few examples – the list is by no means exhaustive, but highlights the many ways pricing information is used across DeFi.
DeFi protocols are designed to return power and rewards to individuals. They are designed to cut out the large, central entities that usually govern financial services. It makes sense, then, that they are built upon a technology powered by individual humans; a technology that values and empowers the voice of individuals, coordinates them as the voice of many, and rewards them for their work and contribution, no matter how small.
If you wish to enquire about integrations, usage, or to learn more about HUMAN Protocol, get in contact with the HUMAN team.
The HUMAN Protocol Foundation makes no representation, warranty, or undertaking, express or implied, as to the accuracy, reliability, completeness, or reasonableness of the information contained here. Any assumptions, opinions, and estimations expressed constitute the HUMAN Protocol Foundation’s judgment as of the time of publishing and are subject to change without notice. Any projection contained within the information presented here is based on a number of assumptions, and there can be no guarantee that any projected outcomes will be achieved.