Protocol Rules
Data Provider Rules
Data providers stake ETC in the Oracle contract to submit data. The Oracle is a contract that implements a proof of stake consensus.
See Oracle Rounds for how oracle settlement fits into the protocol.
The staked ETC deters malicious or inaccurate submissions and lets providers earn MANA for accurate participation. MANA is non-transferable reputation inside the Oracle contract. It weights price consensus and represents a claim on a larger portion of future bounties.
Bounties are funded by swap fees and distributed at price rounds. This creates a direct link between protocol usage and oracle compensation.
To protect the protocol from dishonest behavior, withdrawing stake has a waiting period. This gives the protocol time to identify and penalize malicious actors before they can extract their stake.
Price submission must come from the staked externally owned account. It cannot be delegated through a contract.
The oracle security assumption is economic: corrupting a price should cost more in slashable stake, lost MANA, and lost future bounties than the attacker can extract from the affected pools. See Core Thesis for the higher-level adversarial model.
MANA
The incentive for staking is to accumulate MANA.
MANA is reputation in the Oracle. It is not a fungible token and it cannot be transferred.
A provider earns MANA by submitting prices. The amount earned is proportional to the provider's stake relative to total stake at the time of submission.
For price consensus, each submitted price is weighted by the MANA of the providers that submitted it. The accepted price is the submitted price with the most MANA behind it.
When a staker withdraws part or all of their stake, a proportional amount of MANA is burned.
If a provider submits an incorrect price, they can be liquidated after the round settles. Slashing resets their MANA, can take staked ETC according to the price divergence, and can redistribute pending rewards to remaining data providers.
Mature provider sets
A mature oracle is harder to corrupt when MANA is distributed across independent providers.
MANA cannot be bought or transferred. It has to be earned through participation. If a provider stops submitting, their absolute MANA can remain, but their share of total MANA falls as active providers keep earning. If they withdraw stake, MANA burns pro rata. If they submit a wrong price, slashing can reset MANA.
This makes corruption more expensive over time, provided the market continues funding bounties and no single provider or cartel controls most MANA.
The mature-oracle security assumption is: