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10 sats \ 3 replies \ @nerd2ninja 22 Aug 2022 \ parent \ on: Ask SN: Decentralized stablecoins on lightning bitcoin
What happens if I send a false price (custom packet or something easy for you to google a "malformed packet") to one of these "Oracles"? If you think it wouldn't be from the site the Oracle is expecting, you'd be dead wrong. Internet Protocol is basically US mail protocol. I can put the White House as my return address if I don't care about a reply, the destination address is the only thing that matters.
This is very true. The internet as we know it is weak.
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You don't think there's a way to mitigate this sort of attack at all?
Just one method: You could use a weighted average price from multiple oracles that updates on some determined interval and rejects price changes that are too far outside of the weighted average.
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You are describing a federated oracle system, and federated is not the same thing as decentralized. Oracles provide their service because they make an income doing it, and this income aligns the incentives of oracles to report as unified a price as possible. That incentive naturally aggregates them into a cooperative that controls the pricing mechanism of any system that relies on them.
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