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What Is the Role of an Oracle in a Smart Contract for Options Trading?

An oracle is a third-party service that provides external, real-world data to a smart contract. In options trading, the oracle feeds the current asset price to the contract.

This external data is crucial for determining if the contract's conditions (e.g. strike price reached) are met, triggering the automatic execution and settlement.

How Do Oracles Feed Real-World Price Data into a Derivative Smart Contract?
How Do Oracles Feed External Price Data to Smart Contracts?
How Do Price Oracles Work and Why Are They a Central Point of Failure?
Can Smart Contracts Interact with Real-World Data and Events?