DLC Oracle

Schnorr-signed attestations for Discreet Log Contracts. Trustless, non-custodial financial contracts on Bitcoin L1 — without the oracle ever knowing the contract terms.

Overview

The Mycelia Signal DLC Oracle provides cryptographic attestations that enable two parties to construct trustless financial contracts on Bitcoin without the oracle knowing the contract terms, counterparty identities, or collateral amounts. The oracle is intentionally blind — this privacy-preserving property is a core feature of the DLC design.

Two contract types are supported:

• Threshold contracts — monitor a price level continuously; attest when the price crosses above or below a defined strike
• Numeric contracts — attest the exact price at a scheduled maturity timestamp using digit decomposition

Both types use Schnorr signatures over secp256k1 and are compatible with the DLC specification.

Instances

The oracle runs on two independent instances. Each maintains its own key material, nonces, announcements, and attestations. A contract built against one instance's announcement must be settled using that same instance's attestation.

Payment

Two payment rails are supported. Both are checked on every request — you only need to implement one.

L402 — Lightning (10,000 sats)

Standard L402 protocol. Pay the invoice with any Lightning wallet (Phoenix, Strike, Alby, etc.) and retry with the preimage.

# Step 1 — POST to get the invoice
curl -s -X POST https://api.myceliasignal.com/dlc/oracle/threshold \
  -H "Content-Type: application/json" \
  -d '{"pair":"BTCUSD","strike":90000,"direction":"above"}'

# Response: 402 with WWW-Authenticate header containing invoice + macaroon
# Pay the invoice, then retry with preimage:

curl -s -X POST https://api.myceliasignal.com/dlc/oracle/threshold \
  -H "Content-Type: application/json" \
  -H "Authorization: L402 <macaroon>:<preimage>" \
  -d '{"pair":"BTCUSD","strike":90000,"direction":"above"}'

x402 — USDC on Base ($7.00)

Standard x402 protocol using EIP-3009 transferWithAuthorization. Sign the transfer from your Base wallet and include the encoded payload.

# Step 1 — POST to get payment requirements
curl -s -X POST https://api.myceliasignal.com/dlc/oracle/threshold \
  -H "Content-Type: application/json" \
  -d '{"pair":"BTCUSD","strike":90000,"direction":"above"}'

# Response: 402 with PAYMENT-REQUIRED header (x402 requirements)
# Sign EIP-3009 transfer, then retry:

curl -s -X POST https://api.myceliasignal.com/dlc/oracle/threshold \
  -H "Content-Type: application/json" \
  -H "X-Payment: <base64-encoded-payload>" \
  -d '{"pair":"BTCUSD","strike":90000,"direction":"above"}'

Free Endpoints

No payment required for discovery and read-only endpoints.

Threshold Contracts

Threshold contracts monitor a price continuously and attest when the price crosses a defined level. Use for Bitcoin-collateralized loans, perpetual hedges, or any binary outcome contract.

Register a threshold contract

curl -s -X POST https://api.myceliasignal.com/dlc/oracle/threshold \
  -H "Content-Type: application/json" \
  -H "Authorization: L402 <macaroon>:<preimage>" \
  -d '{
    "pair": "BTCUSD",
    "strike": 90000,
    "direction": "above",
    "expiry": 1780000000,
    "webhookUrl": "https://your-server.com/dlc-webhook"
  }'

{
  "status": "registered",
  "eventid": "BTCUSD-ABOVE-90000-1774050380",
  "pair": "BTCUSD",
  "strike": 90000,
  "direction": "above",
  "expiry": 1780000000,
  "oraclePubkey": "03ff5589b5812f07dec1aad7af189e0513160799820386128a80d37d1503a8e84f",
  "rpoints": ["<R-point hex>"],
  "webhookUrl": "https://your-server.com/dlc-webhook",
  "rail": "secret"
}

Cancel a threshold contract

Send a DELETE to cancel an active contract. The oracle immediately attests safe. Use this for loan repayment or manual contract closure.

curl -s -X DELETE https://api.myceliasignal.com/dlc/oracle/threshold/BTCUSD-ABOVE-90000-1774050380 \
  -H "Authorization: L402 <macaroon>:<preimage>"

Numeric Contracts

Numeric contracts attest the exact price at a scheduled maturity timestamp. Pre-announced 35 days in advance. Use for options, futures, or prediction markets where counterparties need to construct CETs covering all possible price outcomes.

Scheduled expiry series

Fetch a numeric announcement

curl -s https://api.myceliasignal.com/dlc/oracle/announcements/BTCUSD-2026-03-28T00:00:00Z

curl -s https://api.myceliasignal.com/dlc/oracle/attestations/BTCUSD-2026-03-28T00:00:00Z

Digit decomposition

Numeric attestations decompose the price into individual digits, each attested separately. This allows counterparties to construct CETs covering all possible price outcomes efficiently.

Supported Pairs

All 17 pairs support both threshold and numeric contracts. Pair format: uppercase concatenated, no slash.

Webhook Delivery

When registering a threshold contract, an optional webhookUrl can be provided. The oracle POSTs the attestation payload to this URL on breach or expiry. Delivery is attempted up to 3 times with exponential backoff.

{
  "eventid": "BTCUSD-ABOVE-90000-1774050380",
  "outcome": "breached",
  "pair": "BTCUSD",
  "strike": 90000,
  "direction": "above",
  "oraclePubkey": "03ff5589b5812f07dec1aad7af189e0513160799820386128a80d37d1503a8e84f",
  "svalues": ["<s-value hex>"],
  "rpoints": ["<R-point hex>"],
  "attestedAt": "2026-03-21T14:22:10Z"
}

Attestation retrieval via the API remains available regardless of webhook delivery status.

Integration Guide — Threshold DLC

Bitcoin-collateralized loan example:

1. Agree on terms — Strike price, direction (below/above), expiry timestamp
2. Register contract — Lender calls POST /dlc/oracle/threshold with payment credential
3. Get announcement — Response includes eventid, oraclePubkey, rpoints
4. Construct CETs — Both parties use oraclePubkey and rpoints to build Contract Execution Transactions
5. Fund contract — Both parties sign and broadcast the funding transaction on-chain
6. Monitor — Oracle watches price every 10 seconds using multi-source aggregated feeds
7. Attestation — On breach or expiry, oracle publishes svalues
8. Notification — Webhook fires if URL was provided; poll GET /dlc/oracle/attestations/{eventid}
9. Settlement — Winning party uses svalues to complete adaptor signature and broadcast winning CET

Integration Guide — Numeric DLC

Options, futures, or prediction markets:

1. Fetch announcement — GET /dlc/oracle/announcements/BTCUSD-2026-03-28T00:00:00Z
2. Get pubkey and rpoints — From the announcement response
3. Construct CETs — Build one CET per possible price outcome using digit decomposition
4. Fund contract — Both parties sign and broadcast
5. Wait for maturity — Oracle attests within 60 seconds of the scheduled time
6. Fetch attestation — GET /dlc/oracle/attestations/BTCUSD-2026-03-28T00:00:00Z
7. Settle — Use svalues to complete adaptor signature and broadcast winning CET

Cryptography