Hello everyone! Long time no see.
Recently, I shared my opinion about the Graph Protocol somewhere in Cyrator and why I believe it's the market leader in data indexing. While I acknowledge that the Graph is facing some challenges, such as constant selling pressure because of a questionable decision on the airdrop. Data processing market is one of the largest markets. Whenever a sector is formalized, such as finance in the 80s with Bloomberg or the internet with Google and Yahoo, the data layer becomes one of the most profitable and easy to monetize. The Graph is well-positioned in this regard, with many gaps and opportunities still at an early stage. It's also worth noting that the Graph Protocol has a centralized payment portal in its decentralized subgraph network. What is directly a disadvantage, let's try to explain the GRT in more detail:
The current web architecture is client-server-based, granting immense power to whoever controls the server. This leads to centralization, which is not ideal. However, Web 3 offers a new layer that enables mass decentralization. Blockchains like Ethereum will play a crucial role in this movement.

Ethereum provides access to all transaction data, but there is still a large amount of raw data that needs to be stored in a format that can be easily and efficiently queried. Unfortunately, this is not always the case, and teams are building centralized indexing servers to fill this gap, which goes against the decentralization notion that we are striving for.

GRT serves as an open information layer for open blockchains, such as Ethereum, and storage systems (IPFS and Filecoin). This makes it simpler for developers to extricate data and provide it to their users in a quick and effective way.

But how is Graph Protocol decentralized? Well, it involves many different roles in The Graph Network, such as Indexing, Curating, Delegating, and Consuming. Indexers are node operators who stake Graph Tokens to provide indexing and query processing services. Curators are subgraph developers or community members who signal to Indexers which APIs should be indexed by The Graph Network. They deposit GRT to signal on a specific subgraph and earn a portion of query fees for the subgraphs they signal on.

Subgraphs define what data is indexed from Ethereum and how it is stored. Once a subgraph is deployed, it becomes part of a global graph of blockchain data. Delegators contribute to securing the network by delegating GRT to existing Indexers and earn a portion of query fees and indexing rewards in return. Consumers are end-users who query subgraphs and pay query fees to the Indexers, Curators, and Delegators. They are often developers or projects themselves who cover query fees for their applications, just like they would for AWS or any other cloud service.


Source: The Graph Blog; The Graphs Docs;

The Graph (GRT) is a cryptocurrency launched in 2018and operates on the Ethereum platform

The Graph

Indexing protocol for organizing blockchain data

**Hello everyone! Long time no see.**
Recently, I shared my opinion about the Graph Protocol somewhere in Cyrator and why I believe it's the market leader in data indexing. While I acknowledge that the Graph is facing some challenges, such as constant selling pressure because of a questionable decision on the airdrop. Data processing market is one of the largest markets. Whenever a sector is formalized, such as finance in the 80s with Bloomberg or the internet with Google and Yahoo, the data layer becomes one of the most profitable and easy to monetize. The Graph is well-positioned in this regard, with many gaps and opportunities still at an early stage. It's also worth noting that the Graph Protocol has a centralized payment portal in its decentralized subgraph network. What is directly a disadvantage, ***let's try to explain the GRT in more detail***:
_______

- The current web architecture is client-server-based, granting immense power to whoever controls the server. This leads to centralization, which is not ideal. However, Web 3 offers a new layer that enables mass decentralization. Blockchains like Ethereum will play a crucial role in this movement.

- Ethereum provides access to all transaction data, but there is still a large amount of raw data that needs to be stored in a format that can be easily and efficiently queried. Unfortunately, this is not always the case, and teams are building centralized indexing servers to fill this gap, which goes against the decentralization notion that we are striving for.

- GRT serves as an open information layer for open blockchains, such as Ethereum, and storage systems (IPFS and Filecoin). This makes it simpler for developers to extricate data and provide it to their users in a quick and effective way.

- But how is Graph Protocol decentralized? Well, it involves many different roles in The Graph Network, such as Indexing, Curating, Delegating, and Consuming. Indexers are node operators who stake Graph Tokens to provide indexing and query processing services. Curators are subgraph developers or community members who signal to Indexers which APIs should be indexed by The Graph Network. They deposit GRT to signal on a specific subgraph and earn a portion of query fees for the subgraphs they signal on.

- Subgraphs define what data is indexed from Ethereum and how it is stored. Once a subgraph is deployed, it becomes part of a global graph of blockchain data. Delegators contribute to securing the network by delegating GRT to existing Indexers and earn a portion of query fees and indexing rewards in return. Consumers are end-users who query subgraphs and pay query fees to the Indexers, Curators, and Delegators. They are often developers or projects themselves who cover query fees for their applications, just like they would for AWS or any other cloud service.


Source: [The Graph Blog](https://thegraph.com/blog/); [The Graphs Docs](https://thegraph.com/docs/en/);

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"What Google does for search, The Graph does for blockchains."

Subgraphs are the lifeblood of the network. Consumers make queries (or data requests) to relay info like price, volume, and liquidity. They temporarily lived on a hosted service, allowing for free deployment while the decentralized network was being built out.

$GRT is the backbone of the Graph ecosystem, where Indexers play a crucial role by hosting subgraphs and earning issuance and query fees. Becoming an Indexer requires node operators to post a minimum self-bond of 100k tokens.

Curators*, on the other hand, deposit $GRT to subgraph bonding curves and earn a portion of query fees and curation rewards. As more $GRT is deposited into a subgraph, the more valuable the data is perceived to be, and the more query fees it is expected to earn.

For Delegators, delegating $GRT to an Indexer is an opportunity to earn a portion of query fees and issuance without running a node. The process is simple and accessible for non-technical users, as they can securely participate in the network. Indexes set a fixed Fee and Reward percentage, which they keep before passing earnings to Delegators.

So where does demand come in?
Consumers buy $GRT to pay for queries
Indexers stake $GRT to run a node
Curators deposit $GRT to subgraph bonding curves
Delegators delegate $GRT to Indexers

Plus, a % of query fees, withdraw taxes and unclaimed rebates are burned.

Looking ahead, I note that the tokenomics of the project very bad. This should be borne in mind when assessing its overall potential.

Source: Twitter.com/graphprotocol; thegraph.com; The Graph Docs.

"What Google does for search, The Graph does for blockchains."

Subgraphs are the lifeblood of the network. Consumers make queries (or data requests) to relay info like price, volume, and liquidity. They temporarily lived on a hosted service, allowing for free deployment while the decentralized network was being built out.

$GRT is the backbone of the Graph ecosystem, where ***Indexers*** play a crucial role by hosting subgraphs and earning issuance and query fees. Becoming an Indexer requires node operators to post a minimum self-bond of 100k tokens.

***Curators***, on the other hand, deposit $GRT to subgraph bonding curves and earn a portion of query fees and curation rewards. As more $GRT is deposited into a subgraph, the more valuable the data is perceived to be, and the more query fees it is expected to earn.

For ***Delegators***, delegating $GRT to an Indexer is an opportunity to earn a portion of query fees and issuance without running a node. The process is simple and accessible for non-technical users, as they can securely participate in the network. Indexes set a fixed Fee and Reward percentage, which they keep before passing earnings to Delegators.

So where does demand come in?
- Consumers buy $GRT to pay for queries
- Indexers stake $GRT to run a node
- Curators deposit $GRT to subgraph bonding curves
- Delegators delegate $GRT to Indexers

Plus, a % of query fees, withdraw taxes and unclaimed rebates are burned.

*Looking ahead, I note that the tokenomics of the project very bad. This should be borne in mind when assessing its overall potential.*

Source: [Twitter.com/graphprotocol](https://twitter.com/graphprotocol); [thegraph.com](https://Thegraph.com/en/); [The Graph Docs](https://thegraph.com/docs/en/).

It seems to me that GRT is great example how to NOT structure tokenomics:

GRT is a work token. The Graph Network consists of 4 participants:
Consumers:* End-Users that pay for queries
Indexers:* Provide indexing and querying services by staking GRT. The more GRT staked, the more they can index and earn. Providing bad queries will result in their stake being slashed
Delegators:* Stake their GRT with indexers to earn a percentage of the indexer fees
Curators:* Lock/bond their GRT tokens to specific subgraphs to signal the network what data should be retrieved next.

GRT has staking, but ultimately have an immense sell pressure due to:
60% distribution to insiders and VCs
Sizable unlock 3 month after lunch where circ. supply went 4x + VC token unlocks (which may be a slow bleed, as opposed to an instant dump).
GRT rewards for community (indexers, delegators, curators, etc).
Inflation (800k+ tokens daily).
Price action followed consequently and "community" was dumped on.

This is concerning considering the immense sell pressure that will likely outpace buy pressure, especially since the tokenomics have not been thought out well enough to allow for price appreciation. With a total supply of 10.1 billion tokens during the first three years, even reaching $3-4 per GRT (which is a generous estimate) would require it to reach 40 BMC. Therefore, if someone purchased GRT tokens at $1-2, they would only be looking at a 2x increase in value over the course of three years, which is not very impressive for the crypto market. I mean while a 2x increase in value over 3 years may be considered reasonable in the stock market, it pales in comparison to the 10-100x gains that many cryptocurrencies experience in just one year. While the project itself is impressive, the tokenomics are very concerning and it remains to be seen whether the GRT tokens will hold their value over the long term or if they will experience dilution and be worth less as time goes on (Pic #3).


Source: Twitter.com/graphprotocol; The Graph Docs; Coingecko.

It seems to me that GRT is great example how to ***NOT*** structure tokenomics:

GRT is a work token. The Graph Network consists of 4 participants:
- ***Consumers:*** End-Users that pay for queries
- ***Indexers:*** Provide indexing and querying services by staking GRT. The more GRT staked, the more they can index and earn. Providing bad queries will result in their stake being slashed
- ***Delegators:*** Stake their GRT with indexers to earn a percentage of the indexer fees
- ***Curators:*** Lock/bond their GRT tokens to specific subgraphs to signal the network what data should be retrieved next.

GRT has staking, but ultimately have an immense sell pressure due to:
-  60% distribution to insiders and VCs
- Sizable unlock 3 month after lunch where circ. supply went 4x + VC token unlocks (which may be a slow bleed, as opposed to an instant dump).
- GRT rewards for community (indexers, delegators, curators, etc).
- Inflation (800k+ tokens daily).
- Price action followed consequently and "community" was dumped on.

This is concerning considering the immense sell pressure that will likely outpace buy pressure, especially since the tokenomics have not been thought out well enough to allow for price appreciation. With a total supply of 10.1 billion tokens during the first three years, even reaching $3-4 per GRT (which is a generous estimate) would require it to reach 40 BMC. Therefore, if someone purchased GRT tokens at $1-2, they would only be looking at a 2x increase in value over the course of three years, which is not very impressive for the crypto market. I mean while a 2x increase in value over 3 years may be considered reasonable in the stock market, it pales in comparison to the 10-100x gains that many cryptocurrencies experience in just one year. ***While the project itself is impressive, the tokenomics are very concerning*** and it remains to be seen whether the GRT tokens will hold their value over the long term or if they will experience dilution and be worth less as time goes on (Pic #3).


Source: [Twitter.com/graphprotocol](https://twitter.com/graphprotocol/status/1471910052458123269); [The Graph Docs](https://thegraph.com/docs/en/tokenomics/); [Coingecko](https://www.coingecko.com/en/coins/the-graph).

The graph is essentially a duplicate ledger based on graph datastructure instead of a sequential database based on timestamps. All blockchains on the market adopt a binary tree structure which in this case is used to store sequential data by timestamp. This makes insertion of data really fast, however it makes sorting the data potentially a lot slower depending on the query. So, the graph structure of this project enables specific query of the data to be a lot faster, so that algorithms can take decision in much faster increments, which can power a lot of financial services and trading algorithms. This is a very unique proposition with real utility that can give huge financial advantages. The project is likely to get used more in the future for those reasons.

The Graph

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