What is a Discreet Log Contract (DLC)?

A Discreet Log Contract (DLC) is a type of Bitcoin smart contract that enables conditional blockchain payments based on an oracle. These oracles are able to follow outcomes of a real-world events and then port that data on-chain. The most common use case for a DLC is when two parties wish to make a bet on the future outcome of a real-world event. Once the oracle relays the outcome, smart contracts redistribute funds according to the possible outcomes previously agreed upon between the parties.