Can DeFi oracles be better?

As The Block Research explored in a recent report, both Maker and Compound have a common feature: data is collected from a third-party source and then sent to a smart contract.

Given the significance of oracles for DeFi protocols, the third-party data feeds are chosen either directly by the protocol or through governance frameworks. This approach is known as a federated model, which stands out because small similar parts of the system are combined to obtain a common result, i.e. data from feeds are aggregated into relevant value inside an oracle contract. The approach seems the most obvious to use, though it's not the most effective.