The following is a brief summary of a blog post authored by Komodo's Lead Developer JL777.
What are Oracles?
An oracle is a node on a network that takes real-world information, such as basketball game scores or prices on a fiat stock exchange, and transfers them into data that is on the blockchain.
Contracts and Antara Modules use Oracles heavily, as the information they provide allows for logical contracts to advance based on real-world decisions.
What does Trustless Mean?
The word "Trustless" means that no one on the network has to trust that the node running the oracle is trustworthy. This word can sometimes sound counter-intuitive to a newcomer in the blockchain industry, but as the newcomer gains experience, they learn to see the value of trustless networks. The less trust is required, the more the users are able to disregard concerns over malicious behavior from untrustworthy users.
Decentralized Trustless Oracles (DTOs)
Oracles typically rely on votes, or aggregate data, or some other type of network-driven behavior that can be somewhat resistant to malicious manipulation, but no fully trustless solution is truly known.
An ideal decentralized trustless oracle is an oracle that can trustlessly transfer real-world information onto the blockchain. Creating DTOs is a challenge, but the Komodo team has a potential solution.
Timeclock in the Bitcoin Protocol
The solution Komodo is exploring begins with understanding the way the timeclock functions in a blockchain.
Timeclock on a Bitcoin-protocol based chain is a feature that operates as a part of the consensus mechanism.
When a miner finds a block, as a part of their submitted blockhash they indicate the time at which the block is found. However, other miners on the network have to verify that the submitted block hash is valid, and this also takes time.
The timeclock value takes these important details -- the finding and the validating of a block -- into account when its value is established. As a result, the time required to finalize the “timeclock” value can vary by several minutes.
This is, in fact, a decentralized trustless oracle!
Since the Bitcoin protocol is already offering a DTO, the Komodo team proposes to adapt the existing solution into a new format that allows for users on the network to compete to create an agreed-upon set of data.
The nodes compete over what Komodo calls a concept of “data accessible to all nodes."