In the first stage (before more than 1,000,000 users are connected to the Protocol), Oracle is closed and the result of its checks can only be made available externally by ZK-mechanics. But what exactly does Oracle do?
If the Protocol addresses the issue of unification based on the principle: "centralisation is a last resort, unification is useful", then Oracle focuses on the gradual creation of a decentralised system of evaluation and analysis of second-order NFT entities without resorting to a single, trusted, person/service.
To this end, NIFTSY applies a "simple to complex" transition system: in the first stage, scoring - the evaluation of assets on the basis of quantitative and temporal parameters - is developed. At the second stage, voting by various actors of Web 3.0 systems (smart contracts, people, AI, owners of various DDS super-nodes, etc.) is added, i.e. a classic anti-fraud is born. Finally, the last one is a stage of implementing transactional reputation of assets from the moment of their genesis to the end of their existence (burning, sending to "eternal" addresses, etc.) and here already AI-analysis-synthesis methodology works, which is impossible without big data (why is there a step-by-step transition from scoring to classic anti-fraud and only from it to AI-aspect) and work through ZK-mechanics initially.
Let's briefly describe the principles of scoring system and anti-fraud system, created on its basis, because on the first stage (before full release and getting of clients base of more than 1 000 000 people) all the results of system are transferred to Protocol and external sources exclusively through ZK-mechanics, as it is mentioned above. However, such data can be supplied by any other Oracle.
First, Oracle uses possible open sources:
  1. 1.
    DDS registers;
  2. 2.
    Open data from other oracles;
  3. 3.
    Statistical reports on markets;
  4. 4.
    Other data.
So what is the functionality of Oracle? First: the Oracle is based on a primitive model of transactional reputation, i.e.: quantitative criteria (number of assets within NFT, number of NFT shards; initial price of assets, etc.); then - temporal criteria (when NFT was created, when the invested asset was "created", what position it holds in general ratings, where it trades, what is liquidity, what is participation in DEX-, etc.. etc.); finally, and subjective criteria: analysis of Twitter & Reddit (hereafter positive/negative criteria), etc.; analysis of social activity in official groups (if possible) or the most popular - TOP-10; analysis of search results (also plus/minus scores - next step).
So how will the Oracle help the Protocol to develop? There are as many as 10 areas of mutual primary interaction (so of course this list is open/not complete):
  1. 1.
    Oracle makes it impossible to use NFT for "dirty" activities outside local communities, i.e. locally - yes, the Protocol can be used by drug dealers and criminals of other kinds, just like any other tool, but once they go outside - their reputation is greatly reduced (and not by us, but automatically). So everything in this world can have negative consumption capabilities, from a kitchen knife (the most common tool of domestic crime) to TV, but in the end it all comes down to whether the tool was originally created for positive or negative activity.
  2. 2.
    Oracle allows for an objective assessment of the market and this is how the Index was born: the First Decentralized NFT Index, which evaluates not only the top projects but also their transactional reputations. In a single, quantified format. The Index, being quantitative, consists of the ratio of a number of different indicators, i.e. takes into account the quality of entities: NFT, initial assets, relationships of transaction participants, etc.
  3. 3.
    Oracle also makes it possible for users of the Protocol, whichever marketplace they enter through, to obtain objective information about the valuation of assets, without the direct involvement of the valuation entity (government agencies, banks, brokers, marketplaces themselves, etc.): purely on the basis of primitive models. It is this approach that allows scaling the level of Oracle virtually indefinitely: it is sufficient to comply with the requirements to unify the data provided.
  4. 4.
    In addition, Oracle has the potential for secondary analytics, e.g.: storing rarity NFTs through what happens most often? Or how to find DDS anomalies and turn them into NFTs? That is, Oracle becomes a big data provider in its own right.
  5. 5.
    Oracle allows exactly to search for anomalies of different order and thus serves formally as a protocol, but already in another sense - as a tool for unification of markets, industries, etc. Why is it needed? The simplest example is for there to be a single liquidity market where all participants of the process earn, not only those who use the most advanced practices of intercepting this very liquidity.
  6. 6.
    Oracle passes stages: scoring - classic anti-fraud - AI-anti-fraud and in the end - can become one of the tools not only for full analytics of NFT-market and related to it (point 4 above), but also a full DAO, where dependence on human-resource will be minimal and thus it will become a semi-autonomous tool for integration of the Protocol. Example: SaO connects to DAO - and starts to test the Protocol in one of the cases (here we develop an algorithm of implementation of such and continuous updating/addition: in standalone mode). Now there is a problem of centralised oracles and it obviously has to be solved sooner or later: the Project can offer today a conceptual answer to this burning question.
  7. 7.
    The oracle gives everyone the opportunity to become an analyst. And that is a separate and large stratum of development, should the Protocol suddenly reach the ceiling of evolution. Or, more precisely, when: whether you are a trader and a human or just a simple script responsible for the work of a simple IoT system sensor, you have access to the Protocol through Oracle: both inbound (data filling) and outbound (the actual analysis of data located in the Project's repository) operations.
  8. 8.
    One of the most important implications of creating Oracle is a full-fledged ecosystem for DeFi+DEX, DeFi+NFT, NFT+offline, etc. bundles. After all, every entity that is tokenised has to be evaluated somehow. When there is an evaluation format, it's easier than when you have to come up with new and new criteria time and time again.
  9. 9.
    Since Oracle is built on a transactional reputation model - it can be used by services for a wide variety of activities:
    1. 1.
      Conducting airdrop;
    2. 2.
      Authorization on DEX without KYC (by analyzing assets);
    3. 3.
      Ability to bequeath funds anonymously, etc.
  10. 10.
    For the digital (crypto) offshore, Oracle means analogue mechanisms:
    1. 1.
      Bank anti-fraud;
    2. 2.
      Anti-phishing services;
    3. 3.
      LLC performance analytics systems;
    4. 4.
      Creation of a unified database of NFT standards in different valuation profiles, etc.
Yet most importantly, the Oracle allows you to move on to another important stage - the Index. And here's why.