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The Graph (GRT) is a decentralized, open-source indexing protocol for blockchain data.
Starting with Bitcoin’s inception, blockchain technology has become a playground for developers, investors, and organizations. All these entities look to develop new financial instruments and help everyone profit from them. However, navigating around a distributed ledger has turned into a tricky endeavor for newcomers.
Fortunately, innovative projects, such as The Graph, look to simplify things for everyone. This indexing protocol aims to enable developers to build various APIs known as subgraphs for separate queries. This way, it should solve issues like query security, the finality of property, and chain reorganization.
In this beginner’s guide to The Graph (GRT), we take a closer look at how this rare protocol works. Also, we scour through its history, understand its purpose, and why you should give it a try.
Why Indexing Protocols Matter
Cryptocurrency is a decentralized financial (DeFi) system that seeks to eliminate third parties (financial institutions) and traditional currencies. Its goal is to put the power and responsibility in the currency holders’ hands. This would help limit the time and transaction costs. Lastly, it should make transactions more convenient for all parties involved.
Due to the advantages of blockchain technology, individuals, companies, institutions, and organizations have started adapting to it massively. The entirety of the digital currencies adheres to the five properties and the three functions of money. Also, each coin endeavors to address at least one real-world problem. However, not all of them have fully incorporated it. And, many people and organizations have launched their coins without really considering the fundamentals of blockchain technology.
This trend has emerged because new entrants have been more agile in adopting emerging technologies. But, on the other hand, most incumbents still have to deal with legacy systems.
Research conducted by Katharina B., May 2021, for Statista Global indicates that reliance on remittance and peer-to-peer payment has led to a steep rise in cryptocurrency. The paper analyzes how standard cryptocurrency and blockchain technology impact our financial understanding.
Katharina B. concludes that blockchain knowledge isn’t sufficient to accelerate digital currency adoption. That’s due to difficulties in comprehending blockchain languages and the unavailability of concrete data sources.
Nevertheless, Graph (GRT) is a project that adhered to all the primitives of cryptocurrency. It also gives easy accessibility to data about the blockchain system. Just like Google indexes web, The Graph indexes blockchain information on the Ethereum network and Filecoin. The availability of blockchain data will advance the general ideas of the cryptographic ledger. This way, it should adhere to system fundamentals.
The Graph (GRT) in a Nutshell
- The Graph falls under the xDAI ecosystem coin by market capitalization.
- GRT is an Ethereum token that powers the Graph.
- The Graph is the first decentralized indexing protocol.
- Yaniv Tal, Jannis Pohlmann, and Brandon Ramirez launched The Graph in 2018.
- The Graph aims to make blockchain data easily accessible.
- The Graph is an open-source query protocol for blockchain.
- It aims to provide a genuinely decentralized query data solution.
- The Graph uses DApps with GraphQL.
- The Graph indexes blockchain data within the Ethereum network and Filecoin.
- Many regard The Graph as an essential part of the web3 stack.
What is the Graph (GRT)?
The Graph is a decentralized system that indexes protocols such as Ethereum, IPFS, and POA. It aims to query data and facilitate numerous applications both within the DeFi and the Web 3.0 ecosystem.
This project operates as an open-source protocol that empowers anyone to create and public their API (software), a subgraph. Also, it retrieves blockchain data for the subgraph by query using GraphQL.
At the time of writing, developers had built effortlessly on the Graph through a hosted service in productions. Their goal is to establish a fully decentralized system (DApp) later this year as per the whitepaper.
The Graph initially surfaced on the Ethereum network. However, it is currently indexing data from IPFS and POA. As a result, developers can utilize Graph Explorer to create, discover, and distribute all the public information they need to assemble decentralized applications. Aave, Uniswap, and Curve, among others, are the Ethereum DApps currently using the Graph.
The Graph helps new developers acquire the necessary data about blockchain technology. Through its indexing protocol, it seeks to enable them to build their applications. Also, it helps promote the blockchain, the soul idea of cryptocurrency.
This protocol also provides its users with a decentralized financial system (DeFi). Also, it has a native ERC-20 token, GRT. This digital coin powers the Graph and works as a guarantee for the network’s data accuracy.
Indexers can earn GRT by staking while querying data through the Graph network. Thus, anybody can devolve their tokens to indexers to secure the network, thereby getting rewards.
Curators sort out information on the Graph by signaling GRT on valuable APIs (subgraphs). Indexers, Delegators, and Curators cooperate to put together the information for the crypto economy. Also, they help keep a helpful worldwide API for DeFi and Web3.
A Brief History about the Graph (GRT)
The Graph originally appeared in 2018. The masterminds behind this invention are Yaniv Tal, Brandon Ramirez and Jannis Pohlmann. They represent the project, research, and technical team, leaders, respectively.
This talented group of developers studied electrical engineering and at Mulesoft company in the US. Their experience in APIs, IT, and business helped them build their first immutable database (Datomic).
Next, they built APIs and data access systems to help new developers quickly access blockchain data. This was possible using the GraphQL query language.
In 2019, The Graph released its token (GRT) in over 99 nations. They managed to attract $25 million, of which $10 million came from Multicoin Capital, Coinbase Ventures, and Digital Currency Group.
According to Coinmarketcap, at the time of writing, one Graph was selling for roughly $0.8391. It had a maximum supply of 10,057044431 GRT and a market capitalization of 3,930176271. Lastly, the circulating supply reached 4.72 billion GRT.
According to an interview with Tal in the block, the users who curate blockchain data using the Graph will earn a reward (money). This idea will help developers get accessible, helpful information.
How Does the Graph Work?
The Graph’s mission is to provide a fully decentralized protocol for querying data. This way, first-time blockchain users can learn how to use this technology faster and more effectively. First, the system uses GraphQL, a query language that specifies the search criteria. Next, it organizes query-able data in the form of subgraphs.
The diagram below shows some of the technical terminologies that the Graph uses:
- The Consumers ask indexers and pay them for providing data from different subgraphs. Any end-user or organization can be Consumers.
- The Indexers are the Graph’s node operators. They usually join the network by staking GRT tokens and run a Graph node. Their primary function is indexing relevant subgraphs that consumers need. Additionally, Indexers serve fees for querying those subgraphs and set prices for their services.
- Curators use their GRT tokens to signal the subgraphs worth indexing. Also, they receive financial incentives for their work.
- The Delegators are network participants that stake their GRT tokens on behalf of indexers. In return, they earn a portion of the indexers’ rewards. However, they don’t have to run graph nodes.
- The Fishermen and Arbitrators become helpful in case of disputes. For instance, they step in when an indexer provides incorrect data to a consumer.
How to Buy and Own the Graph token (GRT)
Currently, the GRT token is available on top trading exchanges around the world. Anyone can purchase GRT token on the following exchanges:
- Huobi Global
Where to Store the Graph (GRT)
You can store your Graph tokens in a variety of crypto wallets, both software and hardware ones.
These wallets are also known as “hot wallets” because they are always online. You can install them on your desktop computer or smartphone. Here are some of the most popular ones:
- Trust Wallet
These crypto wallets go by the name of “cold wallets” because you can keep them offline most of the time. Usually, they come in the form of flash drives purposely modified to store cryptocurrencies. Some of the most popular hardware wallets include:
Benefits of Using the Graph (GRT)
The Graph aims to make decentralized query protocol easy and accessible to new developers. This way, anyone can create DApps and enhance the blockchain ecosystem.
Holding GRT tokens helps the Graph develop faster and provide more rewards in the long run. Also, staking on the platform can deliver significant ROI.
In conclusion, the Graph is a reliable decentralized protocol that can only improve in the years to come. Jumping on its wagon could be a sensible strategy for investors looking to diversify their portfolios.