Trigger Event

Trigger events can be categorized by their data source:

• On-Chain Triggers: Events that occur directly on the blockchain, such as a token transfer, a specific price from an oracle, or a governance vote passing.
• Off-Chain Triggers: Events originating outside the blockchain, like a weather API reading or a traditional market close, which require an oracle to bring the data on-chain to act as a trigger.

Developers can configure a wide variety of triggers to automate DeFi, governance, and NFT applications.

• Time-based: A specific block number, timestamp, or recurring interval (e.g., "every 24 hours").
• Event-based: Emission of a specific smart contract event log (e.g., Transfer(address,address,uint256)).
• State-based: A monitored on-chain variable reaching a threshold (e.g., a liquidity pool's utilization exceeding 90%).
• Function-based: A specific public function being called on a target contract.

For triggers dependent on real-world or cross-chain data, oracles are essential. They act as secure middleware that fetches, verifies, and delivers external data to the blockchain in a consumable format. A price feed update from Chainlink or Pyth is a classic example of an oracle-delivered trigger event for liquidation protocols or limit orders.

When a trigger condition is met, it must be broadcasted in a transaction to execute the linked smart contract logic. This requires paying network gas fees. Services like Gelato Network and Chainlink Automation specialize in monitoring for triggers and submitting these execution transactions reliably, often covering gas costs for a fee.

Trigger events are the backbone of advanced DeFi strategies.

• Limit Orders: Execute a swap when asset_price >= target_price.
• Auto-Compounding: Harvest rewards and reinvest them on a weekly schedule.
• Liquidations: When a borrower's health_factor < 1, trigger a liquidation to repay debt and seize collateral.
• DCA (Dollar-Cost Averaging): Schedule recurring purchases of an asset.

The security of an automated system depends heavily on its triggers.

• Oracle Manipulation: A corrupted price feed can trigger malicious liquidations or trades.
• Frontrunning: A publicly visible pending trigger transaction may be exploited by MEV bots.
• Trigger Liveness: Ensuring the monitoring service is reliable and has funds to pay for execution gas is critical to prevent failed automations.

In on-chain options protocols like Lyra or Dopex, a trigger event occurs when an option reaches its expiry timestamp or when the underlying asset price hits the strike price for American-style options. This triggers the settlement function, automatically calculating and distributing profits to option holders and assigning losses to writers, all without manual intervention.

A secondary sale on an NFT marketplace like OpenSea or Blur acts as a trigger event. When the transferFrom function is called and a sale is detected (often via the EIP-2981 royalty standard), the marketplace contract automatically calculates the royalty percentage and triggers a payment to the original creator's wallet as part of the same transaction.

In cross-chain protocols (LayerZero, Axelar, Wormhole), a trigger event is the verification of a message proof on the destination chain. When a relayer or oracle submits a valid proof that an action occurred on the source chain (e.g., tokens locked in a bridge), it triggers the execution of a corresponding action on the destination chain (e.g., minting wrapped tokens).

In a Decentralized Autonomous Organization (DAO), a successful governance proposal that passes a vote and meets a quorum is the trigger event. This typically updates an on-chain state variable (like a timelock contract), which then automatically triggers the execution of the encoded transaction, such as transferring treasury funds or upgrading a protocol contract.

On decentralized exchanges (Uniswap V3, dYdX), a trigger event occurs when the market price of an asset crosses a user's specified limit price. This is monitored by off-chain keepers or a network of searchers. When the condition is met, they submit a transaction that triggers the swap at the favorable price, executing the order defined in the smart contract.

Trigger events facilitate complex financial agreements where payment is contingent on verifiable outcomes.

• Insurance Payouts: A verified weather event or flight delay reported by an oracle triggers an automatic insurance claim payout.
• Streaming Payments: The passage of time (e.g., per second) triggers micro-transactions from a streaming vault to a recipient.
• Escrow Release: The confirmation of goods received or service completion, verified via an oracle or multisig, triggers the release of escrowed funds.

Decentralized Autonomous Organizations use trigger events to automate governance decisions and treasury management.

• Proposal Execution: A successful governance vote that passes a quorum and majority threshold automatically triggers the execution of the encoded contract call.
• Treasury Management: A specific date or price level can trigger automated treasury actions, such as buying back tokens or converting assets.
• Delegate Rewards: Staking or delegation activity that meets a reward epoch conclusion triggers the distribution of governance tokens to participants.

A smart contract is the foundational program that contains the logic for a trigger event. It is a self-executing contract with the terms of the agreement directly written into code, deployed on a blockchain.

• Role: It defines the conditions (triggers) and the resulting actions.
• Execution: When a trigger condition is met, the contract's code runs autonomously.
• Example: A lending protocol's smart contract triggers a liquidation when a user's collateral value falls below a specified threshold.

An oracle is a service that provides external, off-chain data to a blockchain, enabling trigger events based on real-world information. It acts as a bridge between on-chain and off-chain systems.

• Function: Supplies data like price feeds, weather data, or event outcomes.
• Critical for: DeFi price triggers, insurance contracts, and prediction markets.
• Example: A yield farming strategy triggers a harvest when an oracle reports that rewards have reached a target APY.

Conditional logic refers to the if-then or if-then-else statements within a smart contract that evaluate whether a trigger event's conditions have been met.

• Mechanism: It compares on-chain state or oracle data against predefined parameters.
• Components: Includes comparison operators (e.g., >, <, ==) and boolean logic (AND, OR).
• Example: IF (user_collateral_ratio < 150%) THEN execute_liquidation().

A gas fee is the payment required to execute a transaction or computation on a blockchain network, including the execution triggered by a trigger event.

• Impact on Triggers: The entity initiating the transaction that satisfies the trigger condition pays the gas. For automated triggers (e.g., via keeper networks), this cost must be accounted for.
• Consideration: High gas fees can make certain micro-transaction triggers economically unviable.

An event log is a structured piece of data emitted by a smart contract to record that a specific action or state change (like a trigger event firing) has occurred. It is stored on the blockchain but is not accessible to other contracts.

• Function: Provides a gas-efficient way for off-chain applications (like front-ends or indexers) to listen for and react to on-chain activity.
• Key Property: Indexed parameters allow for efficient filtering and querying of past events.
• Example: A DEX emits a Swap event log containing token amounts and addresses when a trade is executed.