What Is a ‘Man-in-the-Middle’ Attack on a Centralized Oracle?

A man-in-the-middle attack on a centralized oracle occurs when an attacker intercepts and alters the data transmission between the centralized data source (like a stock exchange API) and the smart contract. The attacker essentially positions themselves between the two parties, providing the smart contract with a false price feed while the original source remains intact.

Since the contract only trusts the single data stream, it executes based on the manipulated price, leading to financial loss for the users.