12 oracles
Donors and backers control projects that they have invested in through the W12 platform using a roadmap. The funds collected are deposited in a smart contract and are issued in stages. Only after reaching the previous key point the project can receive its next installment to reach the next phase. The W12 protocol proposes three decision-making mechanisms to confirm the execution of project milestones:
- Each donor (backer) independently decides whether a key point has been reached
- The fact is determined by their vote
- The decision is made by 12 oracles
Let us consider the third model in greater detail.
Who is Mr. W12 oracle?
This is an expert, who confirms the fulfillment of the obligations of crowdfunding and charity projects before backers and donors. There are many experts, they are not familiar with each other, but they are connected into a single self-regulating decentralized organization, or, as we called it, the Oracle network.
What are they needed for?
We have already considered a situation where the first type of decision making would work perfectly. But fundraising can be much bigger and more difficult to evaluate. In this case, we need oracles, which, regardless of the parties concerned and from each other, will give out their verdict.
How to attract oracle?
The project provides for the costs associated with the maintenance of oracles, their qualifications (lawyers, financiers, volunteers, etc.) and number (min. 12). The experts themselves are selected based on various characteristics randomly from the Oracle network. This is remotely reminiscent of calling a taxi using Uber.
What is the motivation of the oracle?
Oracles are financially motivated. Each expert independently assigns the number of funds that they want to receive for their work. Oracles that make wrong decisions are excluded from the system. Leading oracles who make the right decisions receive more orders and at the highest rates.
How to become an oracle?
Those who wish to become oracles undergo the KYC procedure, as they verify their identities and professional skills. The personal page of each oracle is recorded on the blockchain, displaying its rating and the quantity/quality of decisions.
Oracle use-case example
The ugly story happened the other day. The German journalist raised donations and stole them. If the campaign were on W12, oracles could stop him!
Yesterday, Der Spiegel reported that its former special correspondent Klaas Relocius collected money from readers for orphans, but transferred all the donations to a personal bank account. Relocius became famous for his emotional reports from Syria. Then he confessed to the distortion and fiction of the facts. Klaas’ banter could only have been verified by oracles. Officers, volunteers of public organizations, donors, fellow journalists, representatives of local communities — these are the people who will be suitable for this role. And the KYC procedure and rating system would cut off the unscrupulous ones.
Suppose Klaas raised funds for Syrian children at the W12 site and received 10% for the purchase of medicines. This is the first installment needed to reach the first key point of the roadmap. It is time for control. Sly little Klaas publishes heart-wrenching pictures with texts, as he bought everything and distributed the supplies to the children. Time for the oracles to have a say. “Has the goal been achieved?” The experts put their No in the smart contract using the W12 application. If 7 out of 12 oracles (the ratio is adjusted) make a negative decision, then the smart contract will stop financing all further stages of the roadmap. The deposited funds are unblocked, and the donor, at its discretion, returns them (up to 90% of the invested funds). If the oracles hand out a positive verdict, the smart contract automatically sends the funds necessary for the project to achieve the next key point on its roadmap.
