How Do Different Oracle Designs, like Centralized versus Decentralized, Affect Contract Security?

Centralized oracles are faster and simpler but introduce a single point of failure and trust. If the central provider is compromised, the smart contract is vulnerable to manipulation.

Decentralized oracles aggregate data from multiple independent sources, requiring a consensus mechanism. This redundancy significantly increases security and censorship resistance but can introduce latency and complexity.

Security is generally higher with decentralization.