# How Do Decentralized Exchanges (DEXs) Provide Price Data to Oracles? ⎊ Path

**Published:** 2025-12-05
**Author:** Greeks.live
**Categories:** Path

---

## How Do Decentralized Exchanges (DEXs) Provide Price Data to Oracles?

DEXs, particularly those using Automated Market Makers (AMMs), determine asset prices based on the ratio of tokens in their liquidity pools. Oracles can query these DEX smart contracts directly to retrieve the current pool ratio, which serves as the asset's spot price.

However, this on-chain price is vulnerable to immediate manipulation if the pool is shallow. Some oracles aggregate data from multiple DEXs to create a more robust, time-weighted average price (TWAP).

- [What Are the Main Types of Price Oracles Used in DeFi besides DEX-based Oracles?](https://learn.greeks.live/path/what-are-the-main-types-of-price-oracles-used-in-defi-besides-dex-based-oracles/)

- [How Does a Price Feed Oracle Differ from a Randomness Oracle in Blockchain Applications?](https://learn.greeks.live/path/how-does-a-price-feed-oracle-differ-from-a-randomness-oracle-in-blockchain-applications/)

- [How Do DEXs Manage the Risk of Oracle Failure during a Black Swan Event?](https://learn.greeks.live/path/how-do-dexs-manage-the-risk-of-oracle-failure-during-a-black-swan-event/)

- [How Does an Automated Market Maker (AMM) Calculate the Price of an Asset?](https://learn.greeks.live/path/how-does-an-automated-market-maker-amm-calculate-the-price-of-an-asset/)

- [What Is a Time-Weighted Average Price (TWAP) and Why Is It Safer than a Spot Price?](https://learn.greeks.live/path/what-is-a-time-weighted-average-price-twap-and-why-is-it-safer-than-a-spot-price/)

- [What Is the Role of Time-Weighted Average Price (TWAP) in DeFi Oracles?](https://learn.greeks.live/path/what-is-the-role-of-time-weighted-average-price-twap-in-defi-oracles/)

- [How Do Automated Market Makers (AMMs) in Derivatives Differ in Oracle Dependency from Order Book DEXs?](https://learn.greeks.live/path/how-do-automated-market-makers-amms-in-derivatives-differ-in-oracle-dependency-from-order-book-dexs/)

- [What Mechanism Do Decentralized Exchanges (DEXs) Use to Ensure Liquidity for TWAP Calculation?](https://learn.greeks.live/path/what-mechanism-do-decentralized-exchanges-dexs-use-to-ensure-liquidity-for-twap-calculation/)

## Glossar

### [Decentralized Exchanges](https://learn.greeks.live/area/decentralized-exchanges/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Access ⎊ These platforms offer permissionless entry to cryptocurrency and tokenized asset markets, democratizing capital deployment into novel financial structures.

### [Automated Market Makers](https://learn.greeks.live/area/automated-market-makers/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

SystemArchitecture ⎊ Automated Market Makers represent decentralized trading protocols that utilize algorithmic functions, rather than traditional bid-ask order books, to facilitate peer-to-contract asset exchange.

## Discover More

### [Provide a Simple Code Example of a Function Following the CEI Pattern](https://learn.greeks.live/path/provide-a-simple-code-example-of-a-function-following-the-cei-pattern/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Provide a Simple Code Example of a Function Following the CEI Pattern](https://learn.greeks.live/wp-content/uploads/2025/10/Deconstructed-Mechanism-Illustrating-Asymmetric-Risk-Payoff-Structures-in-Decentralized-Finance-Derivatives-Execution.webp)

Check balance, update balance to zero, then send funds (Interactions) is the CEI pattern sequence.

### [How Do Decentralized Exchanges (DEXs) Differ from Centralized Exchanges in Their Vulnerability to State-Sponsored Attacks?](https://learn.greeks.live/path/how-do-decentralized-exchanges-dexs-differ-from-centralized-exchanges-in-their-vulnerability-to-state-sponsored-attacks/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Do Decentralized Exchanges (DEXs) Differ from Centralized Exchanges in Their Vulnerability to State-Sponsored Attacks?](https://learn.greeks.live/wp-content/uploads/2025/10/Xray-Visualization-of-Bifurcated-Digital-Asset-Settlement-Mechanisms-Leveraging-NonFungible-Token-Call-Options.webp)

CEXs are vulnerable to legal seizure and central server hacks while DEXs resist control through distributed code.

### [How Do Oracles Ensure the Data They Provide Is Accurate and Tamper-Proof?](https://learn.greeks.live/path/how-do-oracles-ensure-the-data-they-provide-is-accurate-and-tamper-proof/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Do Oracles Ensure the Data They Provide Is Accurate and Tamper-Proof?](https://learn.greeks.live/wp-content/uploads/2025/10/Decentralized-Autonomous-Organization-Governance-Mechanism-Prototype-for-Binary-Option-Settlement-Layer.webp)

Oracles ensure data integrity by aggregating from multiple sources, using economic incentives like staking, and cryptographic verification.

### [What Is the Concept of "On-Chain Data Resolution" as an Alternative to Oracles?](https://learn.greeks.live/path/what-is-the-concept-of-on-chain-data-resolution-as-an-alternative-to-oracles/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Concept of "On-Chain Data Resolution" as an Alternative to Oracles?](https://learn.greeks.live/wp-content/uploads/2025/10/Precision-Machining-of-Blockchain-Governance-Mechanism-Cross-Asset-Settlement-Execution-Rod.webp)

Deriving data directly from the blockchain's internal state, like AMM pool ratios, which is susceptible to manipulation.

### [Why Are Low-Liquidity DEXs More Vulnerable to Flash Loan Price Manipulation?](https://learn.greeks.live/path/why-are-low-liquidity-dexs-more-vulnerable-to-flash-loan-price-manipulation/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Why Are Low-Liquidity DEXs More Vulnerable to Flash Loan Price Manipulation?](https://learn.greeks.live/wp-content/uploads/2025/10/Cryptocurrency-Arbitrage-Mechanism-Visualized-as-a-High-Frequency-Trading-Orbital-Construct.webp)

Low Liquidity → Steep Curve → Price Volatility uparrow (Capital Efficiency of Attack)

### [What Role Do Decentralized Exchanges (DEXs) Play in Crypto Options Trading?](https://learn.greeks.live/path/what-role-do-decentralized-exchanges-dexs-play-in-crypto-options-trading/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Role Do Decentralized Exchanges (DEXs) Play in Crypto Options Trading?](https://learn.greeks.live/wp-content/uploads/2025/10/Decentralized-Autonomous-Organization-Governance-Mechanism-Propagating-Kinetic-Volatility-Transfer-via-Exotic-Options-Structures.webp)

DEXs enable peer-to-peer, non-custodial crypto options trading via smart contracts on a blockchain.

### [How Do Decentralized Oracles Prevent Data Manipulation?](https://learn.greeks.live/path/how-do-decentralized-oracles-prevent-data-manipulation/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Do Decentralized Oracles Prevent Data Manipulation?](https://learn.greeks.live/wp-content/uploads/2025/10/Dual-Aperture-System-Simulating-Collateralized-Debt-Positions-In-Digital-Asset-Rehypothecation-Protocols.webp)

Aggregation of data from multiple independent nodes using consensus mechanisms and economic incentives.

### [What Is the Impact of High Market Volatility on an LP's Willingness to Provide Firm Quotes?](https://learn.greeks.live/path/what-is-the-impact-of-high-market-volatility-on-an-lps-willingness-to-provide-firm-quotes/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Impact of High Market Volatility on an LP's Willingness to Provide Firm Quotes?](https://learn.greeks.live/wp-content/uploads/2025/10/Geometric-Abstraction-of-Impermanent-Loss-Mitigation-in-Automated-Market-Maker-Mechanisms.webp)

High volatility increases adverse selection and hedging risk, causing LPs to widen quotes or reduce the size and firmness of their commitment.

### [How Does Physical Settlement Provide a Better Hedging Tool against Spot Market Price Risk?](https://learn.greeks.live/path/how-does-physical-settlement-provide-a-better-hedging-tool-against-spot-market-price-risk/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does Physical Settlement Provide a Better Hedging Tool against Spot Market Price Risk?](https://learn.greeks.live/wp-content/uploads/2025/10/Crystalline-Hedging-Apparatus-Representing-Cross-Asset-Collateralization-in-Decentralized-Finance-Structures.webp)

Physical settlement guarantees the actual asset exchange, removing index risk and providing a more direct, precise hedge against spot price risk.

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**Original URL:** https://learn.greeks.live/learn/how-do-decentralized-exchanges-dexs-provide-price-data-to-oracles/
