Hey guys :) I’m back with another comprehensive Q&A piece, this time for the decentralized protocol for indexing and querying data from blockchains – The Graph (GRT).
The Graph Network aims to make it easy to build dapps on Ethereum and storage networks like InterPlanetary File System (IPFS) by indexing blockchain data and publishing it in open APIs called subgraphs that anyone can query.
Now, before we dive in, the following piece is similar to my latest articles on SushiSwap (SUSHI), Saffron Finance (SFI), and OriginTrail (TRAC), so if you haven’t already seen those, be sure to check them out as well.
Hope you enjoy!
The list of Q&A is kind of long so first comes the list of questions that I have prepared the answers to:
- What is The Graph?
- Who and When Created The Graph?
- What is the GRT Token Used For?
- What is the main product of The Graph?
- Who uses The Graph’s Solutions?
- Who are the main backers of The Graph?
- Where to Store The Graph’s $GRT Token?
- Where to Buy & Sell The Graph’s $GRT Token?
1. What is The Graph?
The Graph website homepage
The Graph is a decentralized open-sourced protocol for indexing blockchain data into open and accessible APIs called subgraphs. These subgraphs can be easily searched for and utilized by developers for building robust blockchain applications.
Developers can use Graph Explorer to search, find, and publish all the public data (subgraphs) they need to build decentralized applications. Anyone can build and publish subgraphs filled with data from leading projects in DeFi and the broader Web3 ecosystem.
In doing this, The Graph makes it possible to query data that is difficult to query directly.
Indexed Blockchain Data “Subgraph” Example:
There is a wide variety of blockchain data that can be indexed in a subgraph. It can be data from decentralized applications such as the popular CryptoKitties dapp, the widely used Uniswap dapp, or any other DeFi, gaming, or generalized Web3 dapp.
Let’s take a look at data that can be indexed into subgraphs from CryptoKitties.
Someone building a dapp requiring data from CryptoKitties might ask the following questions:
- How many CryptoKitties does a specific Ethereum account own?
- When was a particular CryptoKitty born?
- Who are the owners of the CryptoKitties born between January and February of 2018?
In order to answer these questions in a timely manner, this data must be compiled and indexed into subgraphs that have subgraph descriptions, known as the subgraph manifest. The subgraph manifest defines the following:
- Smart contracts of interest for a subgraph
- The events in those contracts to pay attention to
- How to map event data to data that The Graph will store in its database
Once the blockchain data is indexed, it can then be queried with a standard GraphQL API and stored in The GraphCLI so that developers can access it.
This diagram gives a visualization of the flow of data once a subgraph has been deployed:
I know all this sounds kind of complicated… because it is. So let me just break it down for you:
The Graph is a protocol for indexing, storing, and processing blockchain data. It simply makes querying blockchain data fast, reliable, and secure so that developers can more easily create next level dapps.
2. Who and When Created The Graph?
The Graph founders; Yaniv Tal, Jannis Pohlman, and Brandom Ramirez
The Graph was founded by Yaniv Tal, Jannis Pohlman, and Brandom Ramirez in January 2018. Prior to founding The Graph, Tal, Pohlman, and Ramirez all worked together on several startups and spent considerable time thinking about how to build software faster.
They built frameworks, developer tools, and infrastructure to make application development more productive and they dove deep into Ethereum in early 2017. Upon discovering Ethereum, the entrepreneurial co-founders realized that Ethereum’s tooling and lack of mature protocols made it difficult to build dApps.
With that realization, they decided to do something about it, and The Graph was born.
Yaniv Tal, co-founder and project lead at The Graph, has a background in engineering and previously founded two tech startups; TapSavvy and Workflo Inc. He also served as a Partner and Software Engineer at Functional Foundry, as a Principal Software Engineer at MuleSoft, a Specialist Firmware Engineer at HP, among other positions.
Jannis Pohlman, co-founder and tech lead at The Graph, also has a background in engineering and computer science, and worked as a Senior Software Developer and Architect at Codethink Limited, as a Software Engineer ar Workflo Inc, as an External Consultant at Functional Foundry, and more.
Brandom Ramirez, co-founder and research lead at The Graph, also has a background in engineering and worked at many of the same companies and startups as Yaniv Tal and Jannis Pohlman.
3. What is the GRT Token Used For?
The Graph (GRT) token logo
The native token of The Graph Network is $GRT which is used to power The Graph’s decentralized network of Indexers, Curators, and Delegators who work together to organize the world’s blockchain data to better serve dapps and developers.
The total initial supply of $GRT is 10 billion with a new issuance schedule starting at 3% annually. $GRT also experiences token burns expected to be ~1% of query fees plus all deposit taxes are burnt.
That said, the maximum $GRT token supply is 10 billion minted + new issuance - burning.
$GRT Use Cases
How $GRT is used within The Graph Network
Indexers (Earn $GRT)
Indexers are node operators in The Graph Network. To become an Indexer, you must stake $GRT in order to provide indexing and query processing services.
Indexers earn query fees and rewards for their services. Rewards are paid for through new $GRT token issuance that’s distributed proportional to Curator signal and allocated stake.
Curators (Earn $GRT)
Curators can be a few different things; subgraph developers, data consumers, or community members who signal to Indexers which APIs should be indexed by The Graph Network.
Curators signal on a specific subgraph by depositing $GRT into a bonding curve and then earn a portion of query fees for the subgraphs they signal on. This system incentivizes the highest quality data sources and is facilitated via the Graph Explorer dApp.
Delegators (Earn $GRT)
Delegators are individuals who want to contribute to securing the network but don't have the expertise, hardware, or resources to run a Graph Node themselves. They simply delegate $GRT to existing Indexers and earn a portion of query fees and indexing rewards in return.
Delegators select Indexers based on their performance metrics such as query fee rates, uptime history, slashing history, as well as delegator parameters like their cut of fees and rewards from the Indexer.
Consumers (Pay $GRT)
Consumers, likely to be developers or projects, are the end-users of The Graph. They query subgraphs and pay query fees to the Indexers, Curators, and Delegators.
In a way, developers paying query fees for their dapps can be compared to developers paying AWS or cloud service costs to host their applications. However, some dapps might choose to bundle the costs into product fees or pass query fees on to users directly via “gateways” or wallets that will be built on top of open-source contracts in The Graph Network.
4. What is the main product of The Graph?
The main product of The Graph is its decentralized protocol for indexing and querying data from blockchains. Its mission is to enable internet applications that are entirely powered by public infrastructure enabled by full-stack decentralization.
In a way, The Graph can be thought of as a Google-like service but for blockchains. For instance, just as Google indexes the web, The Graph indexes blockchain data from networks like Ethereum or Filecoin. It then groups this data into open APIs called subgraphs and makes it readily available for anyone to query.
In doing this, The Graph enables developers to create fully decentralized applications (dapps) not only at the protocol level, but at the data, storage, and computing level as well. This differs from most dapps that only adopt a decentralized model at the bottom layer of the blockchain stack.
The Graph enables full-stack decentralization – making applications robust to business failures, rent-seeking, and also facilitate an unprecedented level of interoperability.
Instead of paying and relying on a centralized business to store, compute, and manage the data required to keep an application running, users and developers can use The Graph to embrace decentralization and be able to know that the software they invest time and money into can’t suddenly disappear.
5. Who uses The Graph’s Solutions?
Many leading projects in the DeFi and Web3 ecosystem are using The Graph’s solutions, most of whom only started using it in 2020. When The Graph started out the year, it only had 1,000 subgraphs deployed and has since grown to over 3,400 subgraphs, including Uniswap, Synthetix, Decentraland, PoolTogether, Aragon, AAVE, and more.
- Uniswap - historical data and analytics for Uniswap V2
- Synthetix - data on synthetix contracts (trade volume, assets & balances, etc.)
- Decentraland - marketplace data such as land, accessories, collectibles, etc.
- PoolTogether - records data for PoolTogether no-loss lottery
- Aragon - data for optimistic DAOs, data for Aragon connect voting, etc.
- Aave - data for Aave contracts, trade history, liquidity, etc.
The above examples of who is using The Graph to publish their data in subgraphs making it immediately available for querying using GraphQL, is just the tip of the iceberg.
Number of Daily Queries from Jan - Nov 2020 (Source)
In the second half of 2020, The Graph grew 10x from 1 billion monthly queries to over 10 billion queries, averaging over 350 million queries per day.
This kind of growth is sort of unprecedented in the blockchain space and actually reminds me a lot of Chainlink and its parabolic trend of partnerships and integrations.
6. Who are the main backers of The Graph?
The Graph is backed by 16 leading companies and investors in the blockchain and cryptocurrency space.
Some of the most notable backers include:
Coinbase Ventures - an investment firm that invests in early-stage companies and teams building the open financial system.
Digital Currency Group (DCG) - A prominent investment firm that invests in companies, teams, and projects in the blockchain industry. DCG has a mission to accelerate the development of a better financial system.
CoinFund - An investment firm that aims to actively shape the global transition to digital assets and decentralization technology.
7. Where to Store The Graph’s $GRT Token?
MetaMask wallet website homepage
The Graph (GRT) is an ERC-20 token residing on top of the public Ethereum blockchain. That said, you can store GRT in any ERC-20 token supported wallet.
However, the best wallets for storing GRT are non-custodial Web3 wallets that provide seamless access to the best DeFi applications, like Uniswap, Balancer, PoolTogether, etc.
That said, DeFi wallets are the best for storing GRT because the token is widely used and supported in the Ethereum-DeFi ecosystem.
Popular The Graph (GRT) Wallets:
- Trust Wallet (mobile)
- Argent (mobile)
- Coinbase Wallet (mobile)
- MyEtherWallet (MEW) (web)
- Metamask (web)
In addition to the above-listed wallets, The Graph (GRT) can be stored on a wide variety of other reputable wallets supporting ERC-20 tokens.
8. Where to Buy & Sell The Graph’s $GRT Token?
The Graph (GRT) can be bought and sold on a peer-to-peer (P2P) basis but the most popular way to buy, sell, or trade $GRT is through centralized and decentralized cryptocurrency exchanges.
You can buy and sell GRT with cryptocurrency or fiat currency at the following top DEXes and exchanges. In most cases, you will be able to buy GRT with BTC, ETH, or stablecoins.
- Binance - BTC, ETH, USDT
- Coinbase Pro - BTC, USD, EUR, GBP
- Uniswap - WETH, USDC
- Kraken - XBT, ETH, USD, EUR
- 0x Protocol - PAX, TUSD
In addition to the exchanges listed above, The Graph (GRT) is also traded on a wide variety of other exchanges and platforms that enable people to buy, sell, or trade cryptocurrencies.
Hope you enjoyed that read :) Let me know if I have missed something in the comments.