Decentralized Common Knowledge Oracles

Authors

  • Austin K. Williams OpenZeppelin
  • Jack Peterson INDY Labs

DOI:

https://doi.org/10.5195/ledger.2019.166

Keywords:

blockchain, oracle

Abstract

We define and analyze three mechanisms for getting common knowledge, a posteriori truths about the world, onto a blockchain in a decentralized setting. We show that, when a reasonable economic condition is met, these mechanisms are individually rational, incentive compatible, and decide the true outcome of valid oracle queries in both the non-cooperative and cooperative settings. These mechanisms are based upon repeated games with two classes of players: queriers who desire to get common knowledge truths onto the blockchain and a pool of reporters who posses such common knowledge. Presented with a new oracle query, reporters have an opportunity to report the truth in return for a fee provided by the querier. During subsequent oracle queries, the querier has an opportunity to punish any reporters who did not report truthfully during previous rounds. While the set of reporters has the power to cause the oracle to lie, they are incentivized not to do so.

Author Biographies

Austin K. Williams, OpenZeppelin

Security Researcher at OpenZeppelin

Jack Peterson, INDY Labs

Researcher at INDY Labs and a co-founder of Forecast Foundation OU

References

Aumann, R. J. “Agreeing to Disagree.” Annals of Statistics 4.6 1236–1239 (1976).

Buterin, V. “SchellingCoin: A Minimal-Trust Universal Data Feed.” (2014) (accessed 21 October 2019) https://blog:ethereum:org/2014/03/28/schellingcoin-a-minimal-trust-universal-data-feed/.

Buterin, V. “The P + Epsilon Attack.” (2015) (accessed 21 October 2019) https://blog:ethereum:org/2015/01/28/p-epsilon-attack/.

Friedman, J. “A Non-Cooperative Equilibrium for Supergames.” Review of Economic Studies 38.1 1–12 (1971).

Peterson, J., Krug, J., Zoltu, M.,Williams, A. K., Alexander, S. “Augur: A Decentralized Oracle and Prediction Market Platform.” arXiv.org (2018) (accessed 21 October 2019) https://arxiv:org/abs/1501:01042.

Schelling, T. The Strategy of Conflict. Cambridge: Cambridge University Press (1960).

Sztorc, P. “Truthcoin.” (2015) (accessed 21 October 2019) https://www:truthcoin:info/papers/truthcoin-whitepaper:pdf.

Cover image for Volume 4 of Ledger.

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Published

2019-12-13

How to Cite

Williams, A. K., & Peterson, J. (2019). Decentralized Common Knowledge Oracles. Ledger, 4. https://doi.org/10.5195/ledger.2019.166

Issue

Vol. 4 (2019)

Section

Research Articles

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