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The interface between blockchain and the real world
Damjan, Matija
The promise of using blockchain technology in legal transactions is that it will enable smart contracts to self-execute without intermediaries and arbitrators. However, blockchain cannot access data ...outside of its network, so a smart contract can self-execute on its own only within the blockchain. If the contract requires a delivery of goods or a performance of services in the real world, an external agent must verify the facts and add the information to the blockchain. Blockchain can ensure that the data entered has not been subsequently modified, but it cannot guarantee that it is true. The article analyses the role of blockchain oracles - i.e. third-party services entrusted by the parties with verifying real-world data that can trigger smart contract execution. The need for legal impartiality of such agents is discussed.
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