# The Blockchain Oracle Problem in Decentralized Finance--A Multivocal Approach
## 6 Discussion  
This paper provided an overview of the role of oracles in Decentralized Finance and the issues related to their usage. Depending on the applications, we present the main types of oracles proposed. While some applications, such as MakerDAO and Compound, have built-in oracles systems, others, such as Aave and Syntetiv, rely on third-party DeFi platforms, e.g., Uniswap, or specialized oracle providers, e.g., Chainlink [68; 69; 90; 99]. All the solutions displayed advantages and drawbacks due to intrinsic oracle characteristics and trust model design [19]. The first thing to note is that there is always a deviation between the oracle's price and the spot prices of assets [17]. While a deviation of 1 to 2% is acceptable and balanced with operating fees, as in the case of Terra Money, the extreme deviation can lead to severe consequences, as in the case of Synthetix [104; 124]. Deviation in oracle reporting has been monitored in recent research by Liu et al. [17]. While analyzing deviation, they discovered that, while Synthetix relied on external oracle providers, it had a mean deviation of \(\pm\)2%. Other platforms, such as Maker, AmpleForth, and Compound, had a deviation from \(\pm\)5% to peaks of over \(\pm\)200%. It is important to note that the analysis excludes episodes of oracles malfunction or manipulation and displays the deviation of oracles on a regular basis. Considering that oracles' normal behavior includes a deviation of more than 5%, it is important to design DeFi platforms and products to counterbalance this situation efficiently. Many have suggested, due to that reason, that the feeds are to be selected from multiple data sources and oracles, as well as that accepted price should be mean values of those extracted in the previous feeds [111]. What emerges also is that there is an evident lack of standardization. Heterogeneous systems are to be welcome, in the sense that they can meet the different needs of customers. However, the oracle choice and design appear to be arbitrary. From this and related studies, it emerges that there are no rules or frameworks, thanks to which a DeFi project selects an oracle type in place of another [8; 32]. Without a set of accepted rules, the choice over oracle may be simply derived by cost or availability. Moreover, even if the oracle mechanic is made public, there is no way to objectively determine the quality of service as it is instead possible with smart contract auditing [125]. The case of MakerDAO, for example, shows the problem of discrepancies between what is perceived as a working oracle and a faulty one [109]. The fact that the oracles were providing prices with a delayed time with respect to the spot price was perceived as a normal feature by the company, while it was described as one of the problems by articles describing the incident [118; 126; 127; 128; 129; 119]. If there is no agreement on the fact that an oracle should provide prices with a delay and how much deviance should have from the spot price, it is indeed impossible to distinguish between reliable and unreliable platforms. Another important thing to consider is that there is not a clear framework that determines which source can be used as a blockchain oracle or not. Therefore, it is impossible for a service provider to foresee if its data can be used (or misused) on a decentralized platform. This is the case of Curve Finance that was selected (without its knowledge) as a price oracle for many DeFi projects [112]. Being unaware of the third-party data exploitation, it did not pay attention to the outcome that the price feed could have determined. This, unfortunately, led to many flash-loan attacks and losses determined by Curve price feeds, but of which Curve Finance was probably not accountable. The Curve team, of course, replied to the incident, asking to rely on specific oracle services--Chainlink, in that case. A recent study that wanted to show the crescent usage of oracles on Ethereum blockchain also utilizes Chainlink data as a benchmark [53].