“Priceless” financial contracts are contracts that don’t require an on-chain price feed to function, and minimize on-chain oracle usage to reduce the frequency and surface area for oracle attacks. They are designed with mechanisms to incentivize counterparties to properly collateralize their positions without requiring any on-chain price feed. These mechanisms include a liquidation and dispute process that allows counterparties to be rewarded for identifying improperly collateralized positions. Unless a position is liquidated, it is assumed to be solvent (properly collateralized). Oracles are only used when a liquidation is disputed — which is designed to be rare.
Priceless Synthetic Tokens
One can write priceless financial contract templates to create various kinds of financial products. The UMA team has written one to create synthetic tokens. These are ERC-20 tokens whose required backing collateral is determined by the value of a price identifier. There is no on-chain price feed for the values of the price identifier; rather, token holders and token sponsors should monitor the value of this price identifier off-chain to inform their decisions about how much collateral to maintain on-chain. If token sponsors are improperly collateralized, liquidators can liquidate token sponsors’ positions. Improper liquidations can be disputed by disputers. Details on these mechanisms are available here.
Here are some additional resources to look at to better understand how the priceless synthetic token contract works: