Oracle Machine: From DeFi Price Feeding to RWA Data Bridge

The Oracle Machine is a service mechanism in blockchain systems, used to bring off-chain data into smart contracts, and is one of the infrastructures of the blockchain world. Essentially, the core competitiveness of Oracle Machine projects mainly lies in four aspects: the comprehensiveness and reliability of data acquisition, the acquisition of exclusive data and value capture, the security and decentralization of the verification mechanism, and the transmission efficiency and network robustness.

1. The Development History of Oracle Machines

The concept of the Oracle Machine can be traced back to 2014, when the emergence of the decentralized prediction market Augur made people aware of the need to obtain external data on-chain. In 2015, Ethereum co-founder Vitalik Buterin officially proposed the concept of the Oracle Machine, and the same year Oraclize(, now known as Provable), launched the first decentralized Oracle Machine service.

The Chainlink project was established in 2017, proposing the concept of a decentralized oracle machine network (DON), aimed at solving the single point of failure problem. With the arrival of DeFi Summer in 2020, oracles became the most essential external data service providers for decentralized applications, offering price feed services. Due to the surge in demand, oracle projects outside of Chainlink, such as Band Protocol and Tellor, were launched one after another, revealing an emerging competitive landscape.

In 2022-2023, the DeFi market entered a period of adjustment, but the Oracle Machine sector continued to innovate. Cross-chain interoperability and modular blockchain became industry trends, with Oracle Machine services expanding to multi-chain and multi-scenario applications. Chainlink launched the cross-chain interoperability protocol (CCIP), supporting cross-chain data transmission and smart contract interactions. Pyth Network( focuses on financial data Oracle Machine) mainnet launch, attracting participation from multiple traditional financial institutions.

In 2024-2025, Oracle Machine services will expand from Decentralized Finance to fields such as gaming, NFTs, and insurance. The demand for IoT Oracle Machines will increase with the rise of DePIN applications. The combination of AI and Oracle Machines will explore new scenarios for the automated execution of smart contracts.

2. Oracle Machine Track Market Size

It is expected that by 2030, the overall market size of the Oracle Machine sector will be between $13.8 billion and $23.1 billion. This forecast is based on Grand View Research's growth expectations for the Decentralized Finance market and assumes that the market capitalization of Oracle Machines accounts for 6%-10% of the total market capitalization of DeFi.

By the end of 2024, the total market value of the Oracle Machine project will be $10.55 billion, accounting for 11.8% of the total DeFi market value of $(912.68 billion $). Compared to the beginning of 2021, when the market value of Oracle Machine once accounted for more than 25% of DeFi, this proportion has significantly decreased. The core reason for this change is that new models such as re-staking have expanded the industry boundaries of DeFi, but compared to other inherent DeFi sub-sectors, the "necessity" of Oracle Machine remains solid.

3. Major Projects in the Oracle Machine Track

The current landscape of the Oracle Machine industry can be described as "dominated by one player." In terms of token market capitalization and TVS( total protected value), Chainlink is the absolute leader in this field. As of March 2025, the TVS of the Chainlink project is $31 billion, accounting for 53.3% of the total TVS in the Oracle Machine sector, while its token market capitalization is $9.6 billion, accounting for 76.9% of the total market capitalization in the Oracle Machine sector. Apart from Chainlink, projects like Pyth Network, UMA, and API3 also occupy a place in the Oracle Machine field, benefiting from advantages in low latency, verification mechanisms, and data acquisition.

3.1 Chainlink

Chainlink is the absolute leader in the Oracle Machine space. Founded in 2017, it is one of the earliest Oracle Machine projects. Chainlink provides services such as price feeds ( Data Feed ), automation ( Automation ), verifiable random functions ( VRF ), and cross-chain operations ( CCIP ). In 2024, in terms of revenue composition, price feed service revenue accounts for the highest proportion of project income, making up 95% of total revenue, with DeFi protocols as its main service targets; the revenue of the other three service types accounts for a total of 5%. The revenue share from automation services and cross-chain services is both 2%, while the revenue share from random number generation services is less than 1%.

3.2 Pyth Network

Compared to predecessors in the Oracle Machine track like Chronicle, Chainlink, and WINkLink, Pyth Network only launched its project in 2021. The Oracle Machine is a key part of the grand narrative of Solana's high-performance public chain, supporting not only on-chain transactions but also narratives such as DePIN, AI, and low-latency payments. Pyth Network is also a project that the Solana Foundation supports heavily. One of Pyth's important tags is its fast price update frequency.

Pyth Network supports a total of 65 public chains, second only to Redstone, making it one of the oracles with the most public chain support. However, its main price feeding service still occurs on the Solana chain. According to Dune data analysis, both Chainlink and Pyth have established certain barriers in their interactions on Ethereum and Solana, making it difficult for each to expand their market share on the other's public chain.

3.3 Redstone

Chainlink and Pyth occupy core positions in the Ethereum and Solana ecosystems, forming their own distinct ecological labels. However, there are also some Oracles in the market that do not take sides between Ethereum and Solana, but rather provide services to as many public chains as possible. Redstone is a representative of this type of Oracle, having completed integrations with over 70 public chains, making it the Oracle project with the most integrated public chains.

Redstone's products include the Push Model ( and Pull Model ) for the pushing model (, as well as the AI Oracle Machine, a brand new field. The Push Model and Pull Model are currently the two most commonly used methods for obtaining data from oracles. Chainlink uses the Push Model, where data operators push off-chain data onto the chain, which has the advantage of speed but the disadvantage of potential data errors, requiring a robust verification mechanism. Pyth, on the other hand, employs the Pull Model, which has the advantage of relative flexibility, allowing data to be pulled when needed; however, the drawback is that data updates can be unstable. Redstone is currently the only data provider that utilizes both Push and Pull models.

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4. RWA Opens the Second Growth Curve of the Oracle Machine Track

As the "data bridge" of the DeFi ecosystem, the Oracle Machine is deeply integrated with the rapid growth of the industry through core functions such as price feeding and cross-chain settlement. However, as the penetration rate of the DeFi market approaches saturation, the limitations of over-reliance on a single scenario gradually become apparent—protocol revenues are easily impacted by market fluctuations, and the homogenization of technological iterations weakens long-term value capture. Unlike the primary price feeding offered in DeFi, the demand for Oracle Machines in RWA is more complex, including both asset valuation and real-time tracking and on-chain synchronization of physical asset status, making it a new battlefield for the extension of Oracle Machine capabilities. Building a "second curve" in the RWA scenario is expected to unlock a billion-dollar incremental market with trustworthy off-chain data keys.

) 4.1 The demand for RWA pricing services is growing, and the Oracle Machine has become the beneficiary.

The integration of traditional finance and crypto technology is one of the biggest narratives of 2024, which includes Bitcoin ETFs like IBIT that actively embrace traditional channels, as well as traditional assets like U.S. Treasury bonds that actively go on-chain, such as BUIDL. For cryptocurrency investors, real-world assets serve as a favorable tool to hedge on-chain risks. The real-time feedback of off-chain asset prices requires the use of Oracle Machine as a bridge between on-chain and off-chain, allowing investors to monitor the changes in their total asset net worth in real-time.

The price feeding service of the Oracle Machine called by RWA is similar to that of DeFi. Since RWA has only just started to gradually take off in 2023, and the landmark event of BlackRock issuing on-chain U.S. Treasury bonds BUIDL is set for February 2024. RWA is currently in its early developmental stage and still has vast growth potential in the future. Consulting firm McKinsey predicts that by 2030, tokenized real-world assets will reach $20 trillion. As of March 2025, data from the RWA.xyz platform shows that the total asset scale of RWA is $247.4 billion ### including stablecoins (, indicating close to 10 times growth potential. The Oracle Machine, as an important infrastructure for RWA, can achieve significant revenue increments.

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) 4.2 Oracle Machine that has provided services for RWA projects

Multiple mainstream Oracle Machine projects have begun to lay out in the RWA field.

• Chainlink has supported the pricing of tokenized RWAs for Backed Finance.
• Redstone introduces Eurozone government bond ETF data sources to the crypto world.
• Pyth Network has provided pricing services for the RWA platform Ondo Finance.
• Supra's distributed Oracle Machine protocol ###DORA(2.0 provides RWA pricing services.
• Chronicle Labs launched the RWA Oracle Machine "The Verified Asset Oracle"

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) 4.3 Non-financial assets, high-threshold off-chain data modeling

RWA can be divided into financial assets and non-financial assets. Financial assets such as stocks, bonds, etc., have relatively easy data acquisition. Non-financial assets such as real estate, charging piles, etc., require mathematical modeling to reflect prices, which poses higher demands on the Oracle Machine.

For these non-financial assets, the Oracle Machine needs to provide more complex services, such as accessing data sources that can reflect the asset status and influencing factors, such as weather data and equipment operation data, and combining this information with mathematical models to convert it into reliable on-chain prices or risk assessments, thereby supporting the valuation and management of non-financial RWA tokens. Due to the high threshold for valuation modeling of non-financial assets, off-chain valuation companies need to adjust their valuation models in real-time, thus these types of assets have higher requirements for the transmission performance of public chains. High-performance chains like Solana have significant advantages in transmission performance. It is speculated that the pricing of non-financial assets may become a major growth point for Oracle Machines on the Solana chain in the future.

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5. Multi-Type Data Specific Oracle Machine, Industry Growth Curve from 2 to N

Currently, mainstream Oracle Machines are mainly focused on the transmission of price data on-chain, forming a standardized service path represented by DeFi price feeds. However, as the on-chain demand expands, especially with emerging scenarios like RWA, DePIN, AI, and DeSci, which require more complex types, formats, and real-time data from off-chain, the service capability of Oracle Machines is also transitioning from "generalized transmission" to "vertical processing"—building dedicated collection, verification, and upload systems for specific types of data. In the future, the industry will move from "unified price feeds" to a state of parallel development of "multi-type dedicated Oracle Machines," entering a "from 2 to N" phase.