Smart Contracts and Secure Oracles: Enabling New Use Cases for Ethereum by Joshua Tobkin PART 1

Oracles enabling new use cases for Ethereum. My name is Joshua. I'm a co-founder and CEO of a next generation oracle called SuperOracles. So what are oracles and why do we need them in blockchain? So blockchains are closed loop systems.

They don't actually communicate with the outside world. So you can't actually do crosschain communication or get external data on chain without the use of oracles. Oracles are middleware that allow blockchains to communicate with the outside world. And uh there's many other things that actually oracles can do. Oracles can do verifiable compute automation tasks and crosschain communication also known as bridges.

Oracles enhance the expressivity of smart contracts. For example, for gamefi, uh blockchains normally don't produce randomness. So Oracle services can provide this for DeFi. Oracles can provide uh external price feeds and also automation tasks for NFT mints, randomization of attributes, uh off-chain verifiable compute. I I'll be talking a little bit more on that.

Uh onchain sports betting and peer-to-peer online casinos. That's actually a very interesting use case cutting out the casino itself where um peers are basically pooling funds together and acting as a house and they're utilizing there's a couple of projects utilizing our verifiable random function to uh provide provably fair randomness prediction markets and also perpetuals and futures contracts that need uh pricing data and automation for liquidations. Now there's also the entire long tale of of uh data that can be put on chain through optimistic oracles. Uh many of us here are familiar with optimistic designs meaning you introduce a challenge period and uh you know usually enhance with game economic theor uh game theory economic security guarantees. But of course these models do introduce latency.

Nonetheless, you can basically get anything on chain using optimistic oracles. One interesting use case that we have been focusing on at SuperOracles is to help provide some additional safeguards against DEX manipulation. So when you have a low liquidity trading pair and you have an uh an attacker that is basically trying to create an imbalance between the pools, uh this is how a lot of the DEX exploits have occurred in the last couple years. Now, what we can do at Supra and what we're looking to do is is uh the Oracle network itself can be looking at like the last 1,00 blocks or or uh Oracle data itself and detect for historical inconsistent values and flag those values. So what this allows us to do is uh effectively mark different readings as red or green for example or or everything looks good or there's a problem with this report and smart contract developers themselves can decide if they want to use approved values only.

Also what we can do is we can track crosset correlations. So, so because these things are deterministic meaning super itself requires uh to achieve a quorum certificate on any value that we publish we can actually look at for example the price of Bitcoin to USD ether to USD and Bitcoin to Ether to determine if there's any anomaly and if there is we can actually flag this or you know trigger some sort of alert to share a little bit more about some interesting use cases combining multiple aspects of uh various Oracle services. I'm just going to briefly at a high level talk about how we can build an onchain native asset um onchain native asset settling decentralized exchange. So let's suppose we have two different blockchains that don't communicate with each other and ultimately we want to settle on for example Bitcoin. I'm going to kind of walk through what are the components required to do something like this.

So first of all, for us to get the Bitcoin pricing data, you'll need oracles. You can also use Oracle automation to create start and uh or you know limit orders and stop orders. You can also use oracles for verifiable compute to calculate things like um exponential moving averages, MACDs, etc. So traditional finance type of ideas that you're used to in a centralized exchange. Then ultimately um when you want to settle, you're going to have to threshold sign or you're going to have to cryptographically sign the transaction in order to deliver uh the to ultimately settle on the destination chain.

And this can be achieved through verifiable compute through threshold ECDSA. And uh these types of uh you know capabilities are of course cap uh they they can work beyond just Bitcoin. In fact, Bitcoin is a little bit of a harder situation, but you can see that with these different components, there's so much more that you can do with smart contract platforms. One thing I do want to really emphasize is that not all oracles are created equal, you know, and smart contracts actually diminish their security guarantee away from the underlining layer 1 to the security of the oracle. That's why it's really important to choose your oracle wisely.

Bad data in, bad data out. This is why it's critical to utilize a cryptographically secure Oracle solution like Supra who apply layer 1 principles to secure the Oracle layer. We will be deploying our data and uh our verifiable random function to base the layer 2 on Ethereum. in in a matter of weeks. And also, we do have a bunch more coming uh including additional white papers and and uh services and things that maybe no one else really knows about because we've been keeping it um you know, pretty quiet, but uh we're coming out of our shell uh this year.

We're going to main alpha in about 45 days and we're going to be rolling out additional services. And you may be asking what makes super different than the other oracles out there. And it's really comes down to our architecture and the fact that we do apply consensus algorithms to the Oracle problem. We have built a solution that is customized for the Oracle situation where not only can the node operators be bisantine but also the data sources can be bisonantine. You have to be resilient to both.

So we have been working with uh tremendous people. Our chief research officer is Dr. Dr. Anaka Kate. Many of you should know what KZG commitments are.

The K in KZG is Dr. Kate. He's led an incredible team and we're going to market pretty soon. So, while I do have quite a bit more time on the clock here, that actually is the end of my presentation. Um, but since we do have 10 minutes, I'm willing to take any crowd questions.

And if anyone has any questions, you can answer it now. Ask it now or otherwise I'll be over here for another 10 20 minutes. happy to answer any questions. Okay, thank you.