The Graph is a unique protocol to organize blockchain data and serve data queries in a large decentralized network.
GRT is its native digital token and is currently trading at $ 0.14.
Let us see what is the Graph network, what it offers, and can its native token GRT hit the $100 mark in the future.
What is Graph GRT?
The Graph is a decentralized network that is used for indexing and querying data. It is built on the Ethereum network and its token will be an ERC-20.
The Graph was developed in 2017 by Yaniv Tal (project lead), Brandon Ramirez (research lead), and Jannis Pohlmann (tech lead).
The founding team members of the Graph hail from different leading brands like Ethereum Foundation, Decentraland, Orchid, and MuleSoft.
The Graph solves the real-world problem of fetching and indexing blockchain data. Complex smart contracts store their data on the Ethereum network. It makes it difficult for explorers to find relevant data from a large blockchain network.
The founders of the Graph aim to develop an open and decentralized data marketplace. They also want to pay an incentive to data creators and contributors.
It is currently offering data query and indexing services for Ethereum and IFPS networks. It may include other blockchain networks in its protocol in the future but currently, it only supports Ethereum.
How Does Graph Work?
The Graph network allows anyone to create a new data project through an Application Program Interface (API). This API is called a subgraph in this system. It is then available for other developers and users.
Data contributors can create open APIs. Then, the available data can be used by consumers. The economic integrity of the system is ensured through the Graph token GRT.
These are the main influencers in the Graph network system.
Indexers are at the advanced technical level and they earn through query fees and indexing rewards. They are node operators and stake GRT tokens for querying and indexing purposes.
Indexers select subgraphs (APIs) to be indexed to verify the high-quality indices and prioritization.
Indexers need at least 100k GRT tokens for staking and maintaining their indexer level.
Delegators do not run a graph node on the network. They delegate or stake GRT tokens to one or more indexers.
Delegators earn a proportion of the referred task to the indexers. In turn, the indexer would benefit from tasks assigned by delegators.
However, the earning potential of indexers depends on the number of GRT tokens staked. Therefore, the earning of a delegator depends on the pricing methodology used by indexers.
Community members, subgraph developers, and consumers can all work as curators. They send signals to the Graph network about subgraphs that should be indexed.
Curators then earn a proportion of query fees their recommended APIs generate. Thus, the Graph network incentivizes data integrity and keeps the data sources of the highest quality.
Curators can signal their developed APIs as well. They also receive incentives for early signal recommendations.
Users or consumers are the end beneficiaries of the Graph network. They utilize the data presented through data queries and indices.
Consumers are also the payers of the query fees for their projects. It means they essentially run the economics of the Graph network query system.
What is Unique about the Graph?
The Graph network offers a unique solution to the users of decentralized data. They have targeted a large market that potentially covers the whole Web 3.0 and Defi world.
If the network behind a cryptocurrency comes with a unique feature, it is likely to keep the crypto coin in the market for a long time.
The Graph network sees a large marketplace in the decentralized data network. It offers an incentive to data contributors and indexers alike.
Indexers can solve data queries with the help of curators and delegators on the network. Consumers can find a cheap solution for their indexing and data queries as compared to running their own servers and fetching a large blockchain network.
Indexers and regulators earn rewards in the form of GRT tokens on top of the query fees they charge to consumers.
It means the whole network sees an incentive for providing high-quality data and ensures data integrity.
Cobbs-Douglas Production Function
The Graph network also offers a pool reward system to its delegators and indexers. The Cobbs-Douglas function is used to distribute the reward pool on the staking allocation for APIs where the query fees are initially generated from.
A portion of query fees is burned by the network. The Graph network estimates an initial 1% of the total query fees will be burned.
Graph GRT Tokenomics
GRT is the native token of the Graph network. It ensures economic transparency and a smooth payment system within the network.
The GRT coin is built on Ethereum and is an ERC-20 token. It was issued with an initial supply of 20 billion tokens.
The Graph network had initially intended to increase the token supply by 1% annually. However, given the query fees mechanism and transaction taxes, it is unlikely to issue new tokens soon.
Where to Buy Graph GRT?
You can buy GRT coins from any major cryptocurrency exchange. Some of the leading crypto exchanges offering GRT coins include:
- Huobi Global
The Big Question – Can the Graph GRT hit $100?
It is difficult to predict prices for cryptocurrencies as the market is highly volatile. Then, tokens like GRT with relatively shorter histories are even harder to predict.
If a token rests on sound foundations and is backed by a network with solid features, it can perform well in the market.
Let us briefly analyze the price history of the GRT token.
The GRT coin was launched in 2021 with an initial supply of 10 billion. So far, around 4.7 billion GRT tokens have been issued.
Its initial open price was set at $0.26 and it immediately crosses the $0.50 mark doubling its launch price.
Early Price History
The GRT coin traded well in its early days when it reached the all-time high price of $2.88. Since then, it has declined gradually as is the case for any other crypto coin for the last year or so with a bearish market trend.
The current price tag of the GRT coin is around the $ 0.15 mark. In the last three months, the GRT price has fallen from $0.37 to the $ 0.14 mark (as of today).
The current crypto market bearish trend is likely to continue for an intermediate term at least. Therefore, we cannot see a sudden rise in the price of the GRT token either.
Also, GRT tokens are held by early investors with lock-up period compliance. As soon as they release their GRT coins, the market will be flooded with the supply which will again push the prices down.
However, as the GRT token is backed by unique technology and the Graph network offers a solution to a real-world problem, it is likely to grow in the future.
It is unlikely that the GRT token will hit the $100 mark any time soon unless the crypto market sees a sudden bullish trend and also if the Graph network hits a big deal.