RT @DefiantNews: 🔮Oracle failures have been behind most DeFi attacks so far.
Trusted price feeds are key to make financial dapps more secure. Coinbase's oracle may be a step towards getting there.
Q: Even as Coinbase is a liquid exchange, how safe is it to trust prices from just one source? https://t.co/VyNkZTHsMJ
Was going to ask how often do the settle and stamp the price to the eth chain and what this would mean for eth and gas and usage... But actually they aren't, they are just signing the price and allowing anyone else to stamp it to the eth chain - so they won't pay the gas themselves...
So mmmm do we know who will stamp it and pay the gas, or why would anyone else do such if not them? Very interesting but really needs to get stamped reliably and regularly?
> do we know who will stamp it and pay the gas
MakerDAO. They already run many oracles, now they can add Coinbase.
It's also really easy to incentivize relayers to post the data, just pay them if they post a valid signature, limit it to one payment per hour.
Correct, Open Oracle is a direct competitor to Chainlink (despite what the Chainlink team claims), and Coinbase clearly chose to adopt the Open Oracle standard, instead of the Chainlink standard.
Which makes sense considering Open Oracle is 10x better. It's free, doesn't have a parasitic token or centralized KYC requirement.
>CEO and founder of Chainlink, the company that provides crypto price oracles, Sergey Nazarov told Cointelegraph that he does not see Coinbase’s new venture as competition, but more of a complimentary product:
>“We have known about it for months. This came out of a hackathon that was won by Compound. Probably, what will end up happening is that we’ll consume their API.”
>He also noted that the “signature” refers to a regular API signature and not related to a blockchain infrastructure. Furthermore, Nazarov believes that the fact that Coinbase is getting into this space is a sign that blockchain data oracalization is a growing industry segment, and the demand for such services will increase. He did not rule out the possibility of partnering in the future with Coinbase on price oracle infrastructure.
It's important to clarify that this is just an API feed that any oracle project can easily incorporate [as noted by a Coinbase engineer](https://twitter.com/jmart_199/status/1253380990136840193).
You realise 4chan fudded Chainlink non-stop for 2 years to suppress the price? This is why you think what you do.
Anyway, better tell John Wolpert: https://www.youtube.com/watch?v=fGRrBFM0Gx0
>John Wolpert leads ConsenSys’ product and venture lab in Washington DC, building a team of top developers, designers and product people to bootstrap projects on Ethereum and blockchain generally. The lab’s special focus is on innovative approaches to government, compliance and social impact.
>ConsenSys is one of the largest and fastest-growing companies in the blockchain technology space, building developer tools, decentralized applications, and solutions that harness the power of Ethereum. Headquartered in New York, ConsenSys invests in and employs top entrepreneurs, computer scientists, software developers and experts in enterprise solution development and new venture creation worldwide.
>John is a seasoned enterprise executive and serial entrepreneur with 30 years in business — a founder of IBM’s global blockchain organization, the open source Hyperledger Fabric project, the original taxi ride hailing service, Flywheel, and the international life science research consortium, IXC. He has created new lines of business for numerous Fortune 100 companies and government organizations. His writing on open source and open innovation have appeared in Harvard Business Review and publications by Harvard Business School Press.
>Prior to joining ConsenSys, John was the global product executive for IBM Blockchain, with previous leadership roles serving Watson, IBM Cloud, Extreme Blue and alphaWorks.
Not to be rude but you clearly have no idea what you're talking about. Not surprising having been in the cryptosphere for almost 8 years....
Oracle's are exactly what chainlink hopes to bridge. But here is the kicker.
What does chainlink do? It's just like paper money, it does nothing. Why is it better Corporations already have widespread adoption of Hyperledger. Hyperledger can directly interface with Ethereum now and Merkle tree's can be used to prove the data's legitimacy.
And now a well established and respected company, coinbase, has entered the Oracle marketplace.
All this without a centralized shitcoin ie LINK
Vitalik attempted to explain this to but Sergey Nazarov, the CEO of chainlink (I have to spell this out because you clearly can't do 2 seconds of research) is a soft brain and just responded "makes sense" after vitalik told him in nerd speak his business model was pointless. Watch until 35:19
TechCynicalPlatinum | QC: CC 222, BCH 83 | NANO 9 | r/Android7 months ago
Lol but this isn't a decentralized oracle. I don't care about chainlink at all I never looked into it. But this is just something that runs off of coinbases api if you read the article coinbase put out. Yes there's some working to actually make it work and the api is just to stream line the ux for normal people but this is just a centralized solution on a decentralized platform.
And again has nothing to do with chainlink.
Agreed. I have no clue about chain link but parading this as superior to decentralized oracle's is ridiculous - just buy some Libra-associated stocks if you really think that this is the same as a decentralized oracle.
TechCynicalPlatinum | QC: CC 222, BCH 83 | NANO 9 | r/Android7 months ago
Coinbase just created a free version of what took Chainlink tens of millions of dollars and 5 years to create. Turns out you don't need an ERC20 token that has 65% of it's total supply held by the devs. Admins in the telegram are now banning people who mention it. What an absolute shitcoin.
infernalr00tPlatinum | QC: CC 78, BTC 44 | TraderSubs 117 months ago
They created a middle man and now coinbase just removed the middle man.
Expect more exchanges doing the same in the future, also probably charging a small fee.
Bye bye chain link.
The Reddit level of stupid never ceases to amaze me. Thinking chainlink nodes only do prices is like thinking a PC only Plays games.
Also The Coinbase Oracle is a centralised Oracle that gives price data from 1 source. Chainlink provides a decentralized view of price based on data from a large number of Oracle's which get their data from a large number of sources, big difference. 1 node & 1 price vs many nodes & many prices
I'll second this with a more general note:
I have no clue about chainlink, but I do know about oracles. Equating an attempt at a decentralized oracle to a centralized oracle is really weird. This would be like equating crypto to USD and saying "LOL USD did so easily what bitcoin is struggling so hard with" - the entire point of a decentralized oracle is to have a truth on the blockchain without relegating anything to a central authority. If you let individuals (organizations or otherwise) say what is true on the blockchain, you are losing a certain guarantee around decentralization, security, and trustlessness.
Imagine an example: let's say a smart-contract-powered betting website grows and ends up handling 100s of millions of dollars worth of crypto everyday. Now imagine that same website uses this API to figure out what price to buy/sell crypto at on their platform.
What is stopping a rogue Coinbase employee from putting out "price of ETH = 0.001 USD" for a minute and buying out the entire supply of ETH from this betting website? You can have some checks and balances, maybe even lock whatever keys are required in a physical safe with protection at Coinbase HQ. **As the API grows and has more money reliant on it, it will need more protections.** What if they just report false information by accident?
**There are issues here.** I am not trying to pick on Coinbase. I am not trying to promote chainlink (which everyone on this thread seems to be referencing - it could very well be a shitcoin for all I know, or have a bad approach to decentralized oracles). However, it makes no sense to me to praise a centralized oracle, or to act like this is some sort of final, best practices, end-all solution for oracles.
Not really from a technical perspective, but functionally pretty similar. Although, you'd be stupid not to know that Oraclize (another service) existed for months for free as a Chainlink alternative before Chainlink was even around.
It's not decentralized in the slightest, it relies on kyced and manually picked nodes. This means you have to trust the team to accept actually separate nodes - there's nothing stopping them from adding their own nodes, pretending they are separate. That's what full centralization looks like.
Coinbase is centralized, yes, but chainlink is an additional centralized middleman - so removing it reduces the number of centralized actors in the system.
There aren't that many big exchanges. Binance, Bitfinex, Kraken - once they add the signed api too there's zero reason to use any oracle middleman.
SkoopitupPlatinum | QC: BCH 736 | CC critic7 months ago
I'm not sold on chainlink myself but coinbase is obviously centralized. Isn't the whole spirit of crypto to come up with decentralized solutions? Otherwise what's the point? Just participate in legacy markets.
Nobody in crypto cares about decentralization. They pretend to do, until they buy some more crypto using their centralized exchange of choice. They care about cryptocurrencies because that's what appreciates higher in value than anything else in history.
BakedEntPlatinum | QC: ETH 597, CC 163 | TraderSubs 5877 months ago
I see that you post unconstructive degeneracy on this forum. I personally put effort into 8/10 my posts in hopes of creating value and meaningful discussions, although recently I've caught myself with extremely ignorant people, making me lost motivation to put an effort myself. Your comment just disgusts me for how humans sometimes don't care about anything except their personal crypto gains.
BakedEntPlatinum | QC: ETH 597, CC 163 | TraderSubs 5877 months ago
You are the degenerate here man. Stop making assumptions and educate yourself a bit. There wouldn't be any "gAinZ" here without decentralisation, crypto wouldn't even exist. Show some respect and learn about the things you want to talk about.
The greedy fools are a definite minority.
Okay so why don't you tell me why the majority of users hate HEX when that's the only project that have the following attributes:
\- 100% decentralized
I see people post about Chainlink. Guess what? The foundation owns 70% of the tokens for a product that doesn't even work yet and they pump their token by hyping up with fake or useless partnerships. They also collaborate with centralized exchanges that make people lose their money.
Most other projects are similar to Chainlink in that they are centralized, vaporvare, fundraising garbage projects that doesn't deserve to exist. **So when I say that people don't care about decentralization, I mean it.**
BakedEntPlatinum | QC: ETH 597, CC 163 | TraderSubs 5877 months ago
Hex? Oh dear God, please indeed gtfo and never come back.
Just a dip after the 563% gain. Usually happens that some people take profits you know. If you can't handle -40% dips then you shouldn't be in crypto.
Please tell me what's going on with Bitcoin though. Not even a single 2x this year?
This sort of exchange endorsed oracle is something compound has been pitching to exchanges for awhile as part of their Open Oracle plan. Coinbase probably made this service available as a direct result of Compound’s proposal to them.
I’m not convinced of their approach. They seem to think exchanges have an incentive to make defi successful so they must be interested in supplying a high quality price feed, without requiring compensation. I don’t think it’ll end well, I pulled out of compound when I saw their open oracle doesn’t really appear to have a pathway to genuine decentralization. We’ll see
Who in their right mind would trust an exchange for price data? Most exchanges have been caught making up trade volume - I would not build anything reliant on a price oracle on an exchange's oracle system.
Again, various studies showed widespread volume manipulation. Even if everyone except for Coinbase were doing it, your idea would result in some issues,
I would much more readily trust an oracle that extrapolates a price from a distributed exchange's trading book.
That is anything but true - you can poll data and extrapolate a decentralized answer from that, or you could go off a decentralized exchange trading book (+ stablecoins for govt currency prices), etc. Plenty of ways to do it that are decentralized. All have their flaws, but settling and saying "fuck blockchain, lets just centralize" completely defeats the purpose of a smart contract. You would get less towards "decentralized smart contract" and more towards "programs controlled by coinbase" if you blindly put your trust in centralized services like this.
I'm not saying it isn't an approach, or even that it's the worst approach, but it is weird and naive to say that we NEED to rely on centralized oracles.
> you can poll data and extrapolate a decentralized answer
Poll data from where?
> you could go off a decentralized exchange trading book (+ stablecoins for govt currency prices)
This is probably my favorite price feed approach, and I believe MakerDAO actually uses the Uniswap price as one of their oracles.
But you have to know that you're not getting the ETH-USD price, you're getting the ETH-USDC/USDT price. Stablecoins do lose their peg some times. And this is still "centralized" since the stablecoins are totally centralized.
> more towards "programs controlled by coinbase"
Even if MakerDAO was 100% reliant on Coinbase data feeds (which they never would), it's still not "controlled by" Coinbase. It's still a permissionless system, they couldn't censor transactions or seize funds.
>Poll data from where?
Plenty of different options. Trusted sources (could include Coinbase if you really wanted), decentralized approach (e.g. polling from multiple decentralized exchanges), either of those with some sort of trusted verification/combination of the two. I'm not going to claim to know which is better, but moving towards that direction over a centralized API is by far the way we need to go.
>This is probably my favorite price feed approach, and I believe MakerDAO actually uses the Uniswap price as one of their oracles.
>But you have to know that you're not getting the ETH-USD price, you're getting the ETH-USDC/USDT price. Stablecoins do lose their peg some times. And this is still "centralized" since the stablecoins are totally centralized.
Agreed. In practice I think this would be the most promising, but I think it would need to be based on multiple distributed exchanges with a decent bit of volume to prevent it from being susceptible to manipulation. I'd be more prone to trust certain stablecoins dist. exchange trading price as the stablecoins are usually centralize with govt (US or EU regulation) and the actual price can be decentralized due to the nature of the exchange.
>Even if MakerDAO was 100% reliant on Coinbase data feeds (which they never would), it's still not "controlled by" Coinbase. It's still a permissionless system, they couldn't censor transactions or seize funds.
Coinbase has a reputation to maintain. That's proably less risky than relying on code that keeps getting hacked over and over again. Coinbase has very little incentive to crash the oracle feed because how much money would they make? Almost 0. How much would their reputation get destroyed? By a lot; harmed reputation causes them to lose money by providing bad oracle data.
As a developer myself I would 100% pick Coinbase over something like Chainlink.
Agreed, to an extent - more reputable than others, but don't all the exchanges that were caught faking volume have a lot to lose?
Risky game here, and in the blockchain world, not something I would want to build a serious product on.
In terms of incentive: as usage of this API grows, the incentive grows. A rogue employee could easily fake some price info to win a price prediction betting contract, for example.
"It doesn't mention Netflix at all. Are we going to post every article that mentions the words VIDEO STREAMING? That's nonsense."
Yes people generally keep up with the markets they're invested in. This is also a narrow field in an emerging space.
/biz/ is that way ------->
If you're long on LINK, then following advancements in the decentralized finance space is standard practice. If coinbase is determining that oracles are a necessity, then others will follow suit. That's how adoption happens. This is the early adoption phase we're looking at.
Agreed but a few months ago on twitter there was a debate between Compound Finance oracle and Chainlink so obviously this is going to be shared
Also oracles are fairly new to the space in terms of awareness so seeing how coinbase backs compound finance but also added chainlink last summer right before their main net I think its safe to say this was going to be talked about
uh yeah, by having multiple centralized price feeds from different parties.
Now go fix Ethereum community's reliance on Infura! This is a much bigger problem and area of centralization
Metamask and practically all dapps plug in an Infura url to connect to Ethereum nodes.
thanks, I've paid for a few of these but they've all had their own shortcomings. Just like Infura has some shortcomings but its still free and mostly better.
I feel like Ethereum Foundation should be subsidizing this kind of thing.
Just a nuance here: some data high quality data providers such as Brave New Coin and Kaiko aggregate market data before providing it to Chainlink. This is arguably "better".
And there is a certain irony as Coinbase data is already provided in this way through Chainlink.
The Maker price feeds are the most centralized part of the whole system.
The Maker Foundation has selected 14 individuals or organizations to operate the oracle nodes. The data they provide is fed into a medianizer contract, so a single bad actor can't skew the price feed, it would take a majority of the 14 nodes to provide bad data.
I dug through their docs, looks like Coinbase isn't actually posting the data themselves.
What they're doing is providing signed messages over their API that anyone else can post. Basically, Coinbase isn't going to pay the gas fees, but anyone can incentivize relayers to post Coinbase data.
The system is built on Compound's Open Oracle:
It's incredibly bad.
Coinbase chose to use a standard called Open Oracle which is a direct competitor to Chainlink (despite what the Chainlink team claims).
They could have easily used Chainlink. Yet they decided not to. They decided to go with a better competitor, one that doesn't require a parasitic token or KYC to function.
Note that this is not surprising. Anyone with a brain knew as soon as there would be demand, big companies would make their own oracle solutions, not use Chainlink (it's trivial to copy).
Open Oracle allows you to do exactly what Chainlink does (a network of oracles with average/median/etc) but better, free (token not needed) and without KYC.
Oracle service that is trying to solve the problem of getting accurate and trustworthy information and data from the outside world onto the Ethereum network.
For example, if I wanted to know the Dollar to Euro exchange rate at this moment in time - there are a number of sources that could provide this info. But which one is the most trustworthy and accurate?
Bad but not that bad. It'll be more of a problem if more exchanges follow Coinbase's lead though.
Chainlink is a middleman between exchanges and on-chain applications. If exchanges begin directly providing their data, there will be less demand for Chainlink.
It's another datasource for node operators who want to provide crypto prices. Nothing more nothing less. Chainlinks goal is to be an oracle network, not an oracle. At the moment DeFi is the only end user; however the vision of chainlink isn't to simply provide the price of crypto(what coinbase is offering), if it's able to branch out into other sectors(insurance, legacy banking systems, etc) that's where it's full utility lies.
Other systems are linked to chainlink. Swift banking network, celsius, google are just a few examples. Chainlink doesn't just do pricefeeds. It will also tie into all kinds of data. Weather, Crops, sport scores etc.
That is false.
Coinbase is using Open Oracle standard, which replaces Chainlink. Sure you could use it with Chainlink, but why? Open Oracle is free, and better. (Chainlink has a cost and KYC requirement)
As for "other types of data", that is a super low IQ argument. It's trivial to add signature to your API responses. As soon as there is demand for "other types of data", API providers will just add this trivial feature, and make Chainlink utterly obsolete.
tldr you're a low IQ Chainlink bagholder
This is not true.. Coinbase’s so called ‘oracle’ is a single point of failure API (as Coinbase as a single entity is providing the data) that excludes high deviation prices from the mean.
Chainlink on the other hand, aggregates multiple sources with reputable data providers that decentralize any price feed or, any data for that matter. They are building an infrastructure that is easy to use and deploy nodes and use their technology.
On top of that, don’t forget threshold signatures, mixicles, and the numerous enterprise adoptions with Chainlink.
I can see Coinbase providing their API to the Chainlink ecosystem to further decentralize the price feed of BTC and ETH.
How do decentralized oracles ensure that public and free information is actually decentralized? For example let's say I set up an oracle to get paid for providing ETH price data. What stops me from just using the Coinbase Pro API and passing the results through, and as a user how would I know that not everyone else is doing the same thing?
I hold LINK so I should know this, but I don't.
This is actually where centralization helps. If for example Binance had a price feed, you would know that is definitely different from the Coinbase price feed. There is not a single price feed that is decentralized.. unless of course it comes from multiple price feeds.. of which we need to know the source (which will always have a centralized aspect).
That aside, people need to get over the fact that decentralization doesn't mean that no centralized entity exists within the system. That's completely impossible and doesn't exist. The exchange of fiat to crypto itself is a centralized mechanism.
Oh and for the people worried about Link. Don't be. This is good for Chainlink to make it an even more solid oracle feed.
We will see how this plays out once staking and reputation systems will come online. The current data providers that Chainlink has selected to run the current price feeds are getting their data from paid, high quality APIs.
Once Chainlink starts to fully decentralize and allow anyone to run a node and provide data, each will have a reputation. If you’re just using Coinbase API, well, I suppose that’s more decentralization. Multiple people reporting the same price feed to make sure that it stays accurate, but also maybe your reputation won’t be that high for just using a free public API.
You're right about "single point of failure", I don't imagine any Defi projects are going to _only_ use Coinbase.
The question is: let's say all the major exchanges post their price data on chain, and a simple smart contract (like the MakerDAO medianizer) aggregates them. Then, what will you need Chainlink for?
Enterprise solutions because of privacy through Mixicles. Scaling through threshold signatures, off chain calculations, blockchain agnostic, etc etc.
And like I stated, Chainlink is building the infrastructure that anyone can implement their technology (which, has been proven to be robust). They’re not trying to compete with other oracle technologies. Chainlink has far superior capabilities than just ‘aggregated price feeds’. Chainlink is trying to capture the defi market right now, but its use cases are endless.
[44 Ways to Enhance Your Smart Contract With Chainlink](https://blog.chain.link/44-ways-to-enhance-your-smart-contract-with-chainlink/)
Quick correction: Coinbase isn't actually posting the data on chain themselves, they're providing signed messages that any relayer can post on chain.
Basically, this means Coinbase isn't paying the gas fees.