In theory, Web3 is all about decentralization. In practice, it can be very centralized. API3 is a bold effort to achieve decentralization in connecting Web3 applications to the outside world.

In the fragmented ecosystem that Web3 is at this time, interoperability is a key goal in order to make progress. Blockchain oracles are a fundamental part of the so-called Web3 ecosystem, as they can help achieve this goal. Their role is to mediate between various blockchains and data sources that lie beyond them.

As Cointelegraph notes, oracle projects are seeing bullish momentum as crypto startups intensify their focus on interoperability in 2022. In this column, we’ve been keeping track of Chainlink, which is the market leader in oracles in terms of market capitalization, as reported by Cointelegraph.

Today, API3, a top 5 blockchain oracle project as per Cointelegraph, is releasing Beacons, which it dubs “a transparent, scalable, and cost-effective solution for data providers to publish data feeds.” We connected with Heikki Vänttinen, co-founder of API3, to discuss API3’s approach to oracles and what this release signifies.

API3 is a relatively young project. It was started in 2020 by Vänttinen and a group of co-founders, some of whom were previously involved in the Honeycomb API Marketplace. Honeycomb was live between 2019 and 2021, and its main thesis was that the oracle problem is not technical in nature. Rather, the main difficulty is to get a large variety of independent and competing actors to cooperate in a decentralized way and achieve business outcomes.

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