Key Highlights
- Unlike traditional audits, AI-based on-chain oracles can provide real-time protection against exploitation
- They can monitor transactions and identify red flags like flash-loan patterns
- New AI-based oracle tools can reduce audit times from weeks to hours while improving vulnerability detection
As the economy on blockchain technology turned into a trillion-dollar infrastructure, security should be a major focus for its developers. According to the Chainalysis report, more than $3.4 billion was lost due to hacks and exploits in 2025. The biggest culprits were oracle manipulation, flash loan attacks, and logic flaws in smart contracts.
Traditional audits, where firms like Certik or OpenZeppelin manually review code before launch, catch many issues early. But they face problems with runtime threats and attack methods that keep evolving after deployment.
Here, AI comes into play as it can be used as an on-chain security oracle. These are decentralized, real-time systems that monitor transactions as they happen, detect anomalies, and can even prevent exploits before execution completes.
This integration might create a new wave of crypto unicorn startups. By combining AI’s pattern recognition capabilities with blockchain technology, these platforms are creating proactive defense layers, which can actually counter cyber threats in advance.
AI-Based On-Chain Oracles Become New Security Guard
Normal blockchain oracles feed external data to smart contracts, such as Chainlink, providing price feeds. AI turns them into security oracles that actively analyze on-chain behavior.
Forta Network, a decentralized monitoring platform, is the perfect example of this. Forta deploys hundreds of AI-based detection bots that scan for threats in real-time, achieving over 99% hack prevention via its Firewall product, according to Forta.org 2026 upgrades.
These bots use machine learning to identify red flags like unusual transaction sequences or flash-loan patterns. It triggers automated responses such as pausing smart contracts or alerting governors.
Chainlink integrates AI through Functions, which allows developers to call models like OpenAI’s GPT-4o for off-chain computation while maintaining verifiability. This mechanism creates hybrid setups where AI processes data off-chain but delivers tamper-proof results on-chain.
Projects like Oraichain integrated an AI interface directly, using reinforcement learning for reputation scoring of oracle nodes.
Real-Time Fraud Detection Make On-Chain Oracles Proactive from Reactive
The number of frauds in DeFi and tokenized assets has surged at an abnormal pace, where AI-based scams attract crypto crime around 17% in 2025 to between $14 billion and $17 billion, according to Chainalysis 2026 Crypto Crime Report. Old tools react after an exploit takes place. But AI oracles can prevent it before funds get stolen.
Chainalysis, through acquisitions like Hexagate and Alterya, deploys machine learning for real-time on-chain threat detection. It is protecting over $50 billion in funds by blocking malicious transactions, as detailed in the Chainalysis blog. Hexagon uses “low-false-positive” models to identify wallet compromises, phishing attacks, and governance exploits before any funds actually move.
Elliptic enhances blockchain analytics with AI for fraud pattern recognition, including deepfake scams and synthetic identities, according to Elliptic research from 2025.
Forta’s AI-based Firewall integrates at the protocol level, screening transactions before execution on chains like Celo. It prevents over 99% of known attack patterns without requiring setup overhead from protocols.
These systems use anomaly detection techniques, such as isolation forests and autoencoders. They also use behavioral heuristics exploits. This reduces the exploit window from days to minutes.
AI-based Smart Contract Auditing
There was a time when audits used to take weeks. AI reduced them to hours while catching more issues. Tools like Cecuro use proprietary multi-agent AI trained on past exploits, which helps it to achieve 92% detection on real vulnerabilities. This makes them superior to the manual reviewing process.
Hashlock and Certik are now also adopting AI-based analysis alongside traditional manual audits, with Certik’s formal verification spotting subtle logic flaws that humans might miss. OpenZeppelin partners with Chainlink for hybrid security, using AI in Defender for runtime monitoring for smart contracts.
But there is a little twist in the story. OpenAI and Paradigm’s EVMBench from 2026 revealed that advanced models such as GPT-5.3-Codex can exploit over 70% of known bugs. This turns AI into both a threat simulator for testing and a defender for protection.
According to the TechRxiv systematic review from 2026, multimodal frameworks now reach 90% to 98% accuracy on detecting reentrancy attacks, access control issues, and flash-loan exploits.
AI-Based Oracle Startups Attract Attention
The AI-blockchain security market is exploding. Intel Market Research predicts the rapid growth through 2034, sparked by smart contract auditing and fraud intelligence. These tools reduce costs by up to 30% while mandating real-time protections that institutions require.
Startups are achieving unicorn status in this area rapidly. Forta is running a decentralized network with FORT token incentives. Chainalysis is providing an enterprise platform. There are other emerging players, like Cecuro and AnChain.AI are also gaining popularity in this area.
With RWA tokenization hitting hundreds of billions and DeFi TVL rebounding, protocols demand great security. AI oracles can provide it by enabling low-latency detection.
Conclusion
AI-based on-chain oracles are not just random hype, as they are infrastructure. Real-time fraud prevention via Forta Firewall, Chainalysis Hexagate, and AI-augmented audits from Certik are already protecting billions in user funds.
While hackers are developing new techniques to exploit smart contracts, it is important that defense also evolves with them. The future of unicorn startups will be led by those who secure the on-chain economy.
Also Read:3 Infamous Cases of Insider Trading in the Crypto Sector
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