Tellor is a decentralized oracle network built on Ethereum that enables censorship-resistant access to off-chain data. Earlier this month, Tellor launched their latest and very last upgrade, called Tellor 360. According to Tellor’s Co-founder and CTO, Nicholas Fett, the Tellor 360 update brings the protocol a step closer to being the ideal oracle. “The ideal oracle is ,” he explained. simple, flexible and has minimal governance risk The most significant feature of Tellor 360 is the removal of upgradeability, making the protocol completely immutable. This means that no single person or organization will have the ability to alter any aspect of the protocol. Brenda Loya, Tellor Co-Founder and CEO, emphasized that removing upgradability reinforces Tellor’s liveness guarantee  and reliability on the team is decoupled. “The tech should outlive us. That is the point of open, censorship resistant tech,” she said. The team behind Tellor has always valued the importance of building censorship resistant and decentralized systems. Their dedication to decentralization can be seen in many aspects of the Tellor protocol, from the oracle design to its tokenomics. As a result, the Tellor team holds less than 1% of circulating TRB tokens. Prior to the Tellor 360 launch, TRB token holders got to weigh in on the direction that the protocol would take by voting on governance proposals. With the team holding five times less than what is required to reach quorum, this important upgrade to Tellor 360 would not have passed without significant support from the Tellor community. Yes, 5% is significant for on-chain voting. More on that later. The significance of removing upgradeability & governance proposals While has its benefits, such as the ability to fix bugs and improve protocols over time, it contradicts the idea of blockchain’s immutability. Upgradeable contracts reintroduce a point of centralized control as a malicious actor could make unapproved smart contract upgrades. upgrading smart contracts By removing upgradeability, Tellor 360 is now also a lot more resilient to attacks, especially governance attacks, compared to previous iterations of the protocol. Such an attack would now only affect a particular data query type (known as ) instead of the entire system. Removing upgradeability, therefore, simplifies the Tellor protocol by reducing attack vectors, and improves the overall decentralization of the system. queryID New features of Tellor 360 The Tellor 360 upgrade also features the following changes to the protocol: : In order to become a data reporter on Tellor, users are required to stake a minimum amount on the protocol. Reporters who submit bad data, have their staked amount slashed or removed. This acts as a cryptoeconomic incentive that ensures honest data reporting. Tellor 360 calculates the minimum required staking amount in dollar value instead of number of TRB tokens. The minimum amount required on Ethereum is now $1500 worth of TRB and $150 worth of TRB on Polygon. Calculating the staked amount in dollar value produces an in-built buy pressure for TRB tokens which helps to stabilize the price of TRB and improve the overall security of the protocol. Staking amounts calculated in dollars : With the removal of upgradeability and governance votes, the minting of new TRB tokens is no longer voted on by users. Instead, is fixed to the rate of 8000 TRB per month, with 50% of the new tokens being distributed to the team and the rest being allocated to rewarding reporters. Having a fixed minting rate of new tokens eliminates any risk of a malicious actor minting large amounts of TRB to manipulate the system. It also removes the possibility of having a treasury. While DAO treasuries are a great way of involving the community in how funds are spent, it is a trade-off that Tellor had to make in order to boost the security of the system. Automating token issuance token issuance : Tellor’s is the most trustless way of paying for recurring data feeds or one-time queryIDs on-chain. Those using the contract will incur a 2% fee. On Tellor 360, the fee from autopay contracts deployed on a particular network will be used as a reward to encourage reporters on the same network to vote on disputes. This network specific reward structure helps to incentivize reporters to stake and participate on the networks that have greater autopay contract usage, thus satisfying the data query requests on the networks that need them the most. Flexible reward structure autopay contract Impact of Tellor 360 on its Users Some of the more prominent protocols using Tellor include the algorithmic stablecoin platform, and DeFi borrowing protocol, . Most recently, , a decentralized prediction market for NFT prices, has integrated Tellor to fetch NFT market data. Ampleforth Liquity Mimicry What does the Tellor 360 upgrade mean to the protocols that are using their oracle services? According to one of the Co-founders of Liquity, Rick Pardoe, Tellor’s move to remove upgradeability is the most exciting, and significant aspect. “For Liquity, the critical piece of Tellor’s 360 upgrade is a custom fix that ensures Liquity uses Tellor in a safe way as intended. The fix had to come from the Tellor side, as Liquity is itself immutable.,” he said. Decentralization, Degens and a 5% Quorum Beyond ensuring immutability, removing the need or possibility for future upgrades removes the need for governance – something that many teams building decentralized protocols struggle to manage and anticipate. According to , there is almost 1 million MKR in circulation. This ‘High Impact’ poll on was passed with 38,613 MKR supporting, or less than 4%. This demonstrates the fact that even the most popular protocols struggle to engage their communities in governance decisions. This is due to a myriad of factors, including: CoinMarketCap Maker’s Governance Module A general lack of incentive to participate, While some protocols use cryptoeconomic incentives to encourage participation in governance, many rely on the fact that users of a protocol should want to take part in its governance. This does not seem to work. Users not wanting to pay gas fees, Each vote requires on-chain voting, with associated gas costs. This means users have to pay to participate in governance. Methods commonly used to work around this include delegation and snapshots. Delegation is where users can assign their tokens to an individual to vote on their behalf. This consolidates the votes of many users into one transaction, greatly reducing the total amount spent on gas. are votes that take place off-chain. Users connect their wallets to prove their holdings, and place their votes. On-chain actions are then executed later according to pre-set conditions, usually by the team responsible for building or maintaining a certain protocol. Snapshots A large portion of tokens being stuck on centralized exchanges Many speculators hold their tokens on centralized exchanges, in spite of the inherent risks attached. These tokens are essentially held off-chain, since the token holders do not hold their own keys, and are therefore unable to interact with the blockchain in order to vote. Users do not always know votes are taking place. Keeping up with every new proposal requires constant effort. Many times, only the most avid community members are aware of the latest governance proposals and polls taking place. Tellor 360’s upgrade beyond upgradeability means none of these problems will ever affect how the protocol operates in the future. To pass the proposal to upgrade to Tellor 360, the proposal needed to receive yes votes from just 5% of circulating TRB. Part of the Tellor team’s commitment to decentralization means that the team holds less than 1% of circulating TRB. This is a much smaller proportion of circulating tokens than the teams of other projects. Tellor Co-founder Michael Zemrose said that the Tellor 360 upgrade almost did not take place. With the vote stuck at 4.62% and set to expire, the team had all but given up on the upgrade – until a Tellor reporter emerged at the last minute and quorum was achieved. “There were conflicting emotions during those few days; frustrated that we feared the upgrade would be a victim to our own principles, yet proud we had them.  Ultimately, we were elated the vote passed on its own merits,” he said. Tellor was an Oracle Partner of the inaugural Blockchain Oracle Summit: Berlin. BOS22 was the first conference to focus solely on oracles’ importance and design. Leading speakers from across the DeFi-TradFi spectrum came to Berlin to take deep-dives into their work using oracles to power exciting use-cases of blockchain technology. Find out more about Tellor: Tellor Documentation Tellor Updates Tellor Twitter Tellor Discord Tellor YouTube

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What is Tellor 360? - Upgrading Beyond Upgradeability

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