- QED connects multiple blockchains, smart contracts platforms, and off-chain data sources.
- QED protocol builds an oracle aggregator that can improve trust and the quality of smart contracts.
The blockchain problem is to reach a consensus. Therefore, extrinsic information cannot be provided with transaction data, as other nodes can detect information from unreliable sources. Hence, information from the real world requires third-party verification whose reliability is unquestionable for all nodes. Oracles retrieve information from the past as well as storing data. But the current oracle problem is defined as security, authenticity, trust conflict between third party oracles, and the trustless smart contract execution.
Oracles cannot provide trustless verification that ownership of an asset has been transferred to the new owner even if the new individual has a token that represents ownership of blockchain. Smart contract possession does not always translate to real-world ownership. Therefore, Smart contracts need to rely on third-party verification for the events of the real world in the form of an oracle.
Smart contracts are also not engaged based on the level of risk involved. For example, a smart contract containing $50 and others containing $500m in value can be processed using the same aggregation and formula, thus exposing clients to risks throughout the execution of the contract. Also, smart contracts cannot pull out or push in data to any external systems as built-in functionality. In this regard, a smart contract would rely on information from markets to make settlements.
For these reasons, a decentralized technology for an oracle solution was built known as QED.
QED Oracle Protocol
QED, developed by Origin Ventures capital firm, is a decentralized oracle protocol with a robust economic model connecting multiple blockchains, smart contracts platforms, and off-chain data sources. The platform is taking a unique approach to solving the oracle problem. It eliminates systemic risks by demanding oracles to provide collateral as a bond to their smart contracts.
The QED oracle is designed to interface with any blockchain or smart contract platform. Its performance scaling components are built on a UX network, while treasury and funding components are built on Ethereum to secure value usage settlement.
QED Solving Oracle Problem.
The QED developers, through Twitter, reiterated that the oracles provider’s aim is incentivizing to deliver accurate data by supplying a staking bond attached to their smart contract. The QED protocol is building an oracle aggregator that can improve trust and improve the quality of smart contracts.
To tackle the blockchain oracle problem, QED has devised several methods. One involves commercial viability. QED’s primary feature, according to QED developers, is the ability to offer automated recourse to control data quality. Thus, the protocol requires the utilization of external collateral bonds as their smart contract. QED rewards node operators who prioritize consistency and value.
According to Origin Ventures, existing oracle solutions are unsuitable for commercial dApps. The same risk checks, accuracy measures, and aggregation formula in chain-link protocols are also used without considering the commercial risks involved. In such cases, accuracy problems, then, can expose oracle-reliant enterprises to risks that are easily avoidable using a different approach. The middleware links dApps with reliable tamper-proof data to solve the problem. Therefore, the introduction of such external collateral shields enterprises from throughout the execution cycle.
The economic incentive model optimizes the performance of the ecosystem and the value of the QED token. But the QED tokens will be given to oracles to incentivize and allocate ownership to ensure a healthy ecosystem. The most accurate oracles will take control of the protocol to maintain high accuracy models.
There will be a minimum of 400M supply and a maximum of 1B supply of QED tokens, with the remainder 600M to be minted through the oracle fee structure. But oracle will require a minimum stake of QED to register and operate the platform. QED cannot be staked for collateral to avoid a death spiral.
In addition, QED uses a post-execution process to determine loss restitution. Customers can use the collateral claim process to recover their losses in case a loss occurs.
QED deals with the integrity of data provided and recovery of the potential loss. QED model allows the market to find fair pricing levels as it re-balances risk profile to a level playing field that is commercially viable. Therefore, smart contracts can access data at a frictional cost that does not interrupt their business case. Oracles can deliver data at a larger scale for the customer base.
In conclusion, QED is a model protocol looking at things from the commercial angle, while other protocols are focused on technological improvement. It has a unique selling point inclined to accuracy and incentive global accuracy with their node operators aimed to reach consensus, supply tamper-proof and unmodified data. QED integration with the UX network offers a combination of recourse mechanisms with other commercial-oriented features. This will help eliminate risk features, thus leveling the playing field between blockchain oracles and their users.