Definition
A price oracle is a data provision concept in blockchain systems that supplies on-chain applications with asset price information originating from external markets. It serves as a trusted reference for current or recent prices of tokens, currencies, or other financial instruments, enabling smart contracts to reference off-chain market valuations while remaining deterministic and self-contained within the blockchain environment.
In Simple Terms
A price oracle is a way for blockchain applications to know what an asset is worth in real-world markets. It delivers current or recent prices for things like cryptocurrencies or fiat pairs so smart contracts can refer to those values when they need a reliable price reference recorded on-chain.
Context and Usage
The term price oracle is commonly used in discussions about decentralized finance, derivatives, lending protocols, and automated trading logic that depend on external market valuations. It appears frequently in technical documentation, risk frameworks, and protocol specifications where accurate and timely asset pricing is required for functions such as collateral valuation, settlement calculations, and contract conditions that reference external price levels.