How Do Decentralized Oracle Networks like Chainlink Enhance Security?

Decentralized oracle networks (DONs) enhance security by aggregating data from multiple independent, high-quality data sources and nodes. This decentralization prevents any single node or data source from corrupting the price feed.

The data is validated by a consensus mechanism among the nodes before being delivered to the smart contract. This robust, fault-tolerant design makes it significantly harder for an attacker to manipulate the price data used for financial derivatives.