Have you heard of The Graph—GRT for short? The Graph is a relatively new cryptocurrency and technology solution that connects Ethereum-based blockchain projects. GRT is the utility token that powers The Graph.
Let’s dive into The Graph and GRT to find out more. Learn what The Graph is, how it works, and where you can buy GRT.
The Graph is a decentralized indexing protocol that is compatible with projects built on the Ethereum blockchain. The Graph enables queries of other Ethereum-based projects, for the purpose of collecting and indexing verifiable information. The Graph aims to support a network of open infrastructure—known as subgraphs—that enables anyone to securely receive any information produced by Ethereum-based blockchains.
GRT, as The Graph’s utility token, can be used to directly participate in The Graph’s protocol—GRT holders can collect or offer verifiable data. GRT is also used to reward The Graph’s network participants. As an ERC-20 token, GRT is compatible with the Ethereum blockchain.
The Graph’s subgraphs are publicly accessible interfaces that anyone can use to query blockchain data. The Graph hosts thousands of subgraphs, and anyone with the relevant coding skills can use The Graph to launch their own subgraph. Users of subgraphs are required to own GRT to pay for a subgraph’s indexing services.
By organizing and indexing blockchain data, The Graph aims to support the transition to a decentralized internet—otherwise known as web3. The Graph is supported by The Graph Foundation and The Graph Council, both of which help to steward the blockchain. Investors in The Graph include Coinbase Ventures, Compound, and Tiger Global Management.
The total supply of GRT tokens is capped at 10 billion. Around 4.7 billion GRT are already in circulation.
The Graph enables anyone to develop open architecture—subgraphs—to index Ethereum-based blockchain data. Network participants can also use existing subgraphs developed by others to access Ethereum-based information.
The Graph is operated by curators, indexers, and delegators. Let’s dig into each:
Curators: Curators help to signify which subgraphs may be the most useful indexes. By assigning varying amounts of GRT to each subgraph, curators help users of The Graph to understand which subgraphs are likely the best.
Indexers: The Graph’s blockchain is primarily operated by indexers, who take cues from curators. Indexers operate the blockchain’s nodes by serving search queries to subgraphs. Indexers are motivated by GRT rewards, which are generally higher for more useful subgraphs.
Delegators: The Graph’s delegators allocate their GRT to indexers, which pays the indexers’ GRT rewards. Delegators, in return, receive a share of those rewards. Early delegators to successful subgraphs can receive a greater share of the subgraph’s rewards, motivating many delegators to create open-source software that makes a subgraph easier to use.
The Graph’s protocol includes mechanisms to reduce, over time, the amount of GRT tokens in circulation. This design, at least in theory, makes the coin a deflationary asset. Around 1% of query processing fees are currently burned—removed from circulation—by The Graph’s blockchain protocol.
You may be curious about which projects or subgraphs are hosted by The Graph. Here are some of the most established subgraphs:
Uniswap: The subgraph for Uniswap, a decentralized cryptocurrency exchange, is used to query cryptocurrency trading data. The Uniswap subgraph can provide detailed, verifiable data for each trading pair listed on the Uniswap exchange.
MakerDAO: The Graph’s subgraph for MakerDAO enables users to search and view MakerDAO’s governance decisions. MakerDAO is an organization with decentralized governance that exists to support the stablecoin DAI.
Decentraland: The Decentraland subgraph provides data pertaining to the virtual marketplace hosted by Decentraland. The Decentraland blockchain, which is games-based and designed as a metaverse, enables users to create and monetize virtual content.
Thousands of subgraphs already exist. Uniswap is also a customer of The Graph, relying on subgraphs to receive verifiable trading data. CoinGecko, a crypto analytics firm, is an example of an off-blockchain enterprise that uses The Graph to obtain blockchain data.
The Graph is among the newer blockchains, having launched in December of 2020. The Graph operated in beta mode for three years prior to its formal launch.
The Graph established The Graph Council and The Graph Foundation in 2020 to enable the development and growth of the blockchain. In July, 2021, The Graph launched a development platform called Subgraph Studio to support subgraph development and deployment on The Graph.
Four development teams received grants in 2021 from The Graph. These development teams are assisting with core development of The Graph’s blockchain. The grant recipients were Semiotic AI, StreamingFast, Figment, and The Guild.
The Graph Foundation in January, 2022, announced that it had raised $50 million through a strategic sale of GRT. The funds are being dispersed as additional grants to develop key features of The Graph’s blockchain.
You can buy GRT using a few different methods. You can use a centralized cryptocurrency exchange or a blockchain-based decentralized exchange. Another option is to establish an individual retirement account (IRA) that supports GRT. Let’s examine each of these options:
Use a centralized crypto exchange: You can establish an account with a centrally managed crypto exchange to buy GRT. Coinbase, Binance, and Kraken are among the exchanges that support GRT tokens.
Participate in a decentralized exchange: You can buy GRT with greater privacy and autonomy by using a decentralized exchange like Uniswap. Using a decentralized exchange requires you to have your own digital wallet.
Invest through a crypto IRA: You can directly own GRT and other crypto assets by establishing a crypto IRA. GRT is supported crypto IRA platforms including iTrustCapital.
If you are just learning about GRT, then it’s important to become knowledgeable about the cryptocurrency before buying it. As a new asset class, cryptocurrency can be risky because asset prices can be volatile. Know the risks of owning GRT before making any investment decisions.
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