The Graph Protocol and why it is my favorite crypto project and an essential part of the smart contract ecosystem.
I am a graph (GRT) token holder and a procurement supply chain professional. This article provides a long term opinion on what the project could grow to be and is not and should not be considered financial advice; however, after learning about the Graph Protocol and seeing what it does I only felt it right to share based on both my investment and why I see it as essential from a smart contract prospective. If you need background on me feel free to connect with me on Twitter @@KBCryptoStocks.
First I will start off with answering the important question of what is the graph and how would I explain it to my grandma? I got that concept on a recent Ask Me Anything for OkCoin when they were discussing Avalanche Crypto (Also a great project and would be happy to cover it in another article.) To explain the graph protocol at the most basic level for people; I would say imaging a large file room for a fortune 500 company that contains all their contract and purchase agreements. Now imagine all the data contained in those files. Think of the file room like a blockchain and the individual file documents like information stored on a blockchain. Now ask the question of how do you find that data when needed? In the current and historical environment, you use either a paper or excel based indexing system run by humans. The graph is the modern and future version of this index without the issues of human error that currently exist in file and data management and mapping for company projects, transactions, and requirement tracking.
Next, I will discuss the potential scope of why the graph protocol matters. If you take the concept above imagine the number of transactions a fortune 500 company processes in a given year. This is probably hundreds of millions if not billions of dollars spent and almost all transaction and data processing needs are being digitized if they haven’t already. This means industries are swimming in data oceans with no maps on what data they have available based on their customers and their supplier sides of their businesses. For anyone who read about early explorers like Columbus who found North America when trying to get to Asia knows you need a map (the graph protocol) to navigate a data ocean. Mapping these oceans leads to functional data that can be used in many different ways which I will discuss in the next section. To just give some idea on the scope I will break down some general math to show the scale of data that could one day be on the blockchain and need the graph to map the data. In 2018 the global GDP was $90 Trillion annually (https://blogs.worldbank.org/developmenttalk/how-large-public-procurement). This is just at a macro level and not even getting into a micro level but as the global procurement ecosystems for people, businesses and governments converts to digital and blockchain technologies this is a huge amount of data mapping, indexing, and curating for protocols like to graph to play a role in providing decentralized data collection and addressing the current problem of having a single point of failure due to human error in the existing model. The Graph actually through delegation and interactive users in the network solves that by creating a data policing structure that can return more accurate data and save time which is the most valuable asset a company has. This is just one aspect of where the Graph could play a huge role in the future. The max supply of graph tokens is only 10B which may sound like a lot but when you consider the multiple markets it could play in and the amount of data transactions being processed in a day that need to be logged and indexed it is minuscule. There are currently trillions of data points created by business transactions alone in a given year globally and this doesn’t get into, governments (i.e Reno NV with their chainlink connection), individuals, and new systems that could use data protocols imagine Netflix but it is able to really map movies you are interested in vs just random data. So not to go too deep but as one can imagine Graph referring to themselves as the Google of Crypto could be bigger than the current google as it is more than just a search engine and what could be built on it is truly next level.
Lastly, I will discuss some of the things I would love to see built on the Graph and dApps they could be great for society. With data collection and mapping, aggregation is needed to find patterns and trends to streamline processes. This means an aggregation dApp built on the graph could lead to the most efficient blockchains and potentially solve many of the transaction time and fee problems as it would provide the most efficient and cost-effective path for a transaction. This could lead to instant transactions for investments, instant payment validation, and acceptance scenarios with almost no counter-party risk due to efficient and accurate data logging. This means efficient settlement and dispute resolving as well so could be great for a partner with something like PAID network. The Graph has mentioned they plan to expand to blockchains beyond ETH which is amazing as cross-chain data engines will be essential to connect the world in the future and cross-chain engines are gonna need conversion dApps that the graph could play a role in by collecting data for instant conversions and pulling without corrupting the data in translation from chain to chain. One other potential dApp would be auto data syncretization allowing for data to be auto pooled for utilization on dApps for things such as directed advertising, direct content management for research, and other things where someone may want to reach a specific audience to do things such as build defined growing customer based or imagine healthcare getting put on a blockchain and actually being able to have a full-scale data picture of your health and genome data. If people look into Cathy Wood and her discussion on genomics mapping and analysis applied to health care will be life-changing in the future long term. These are just some of the things that could be to come but you can imagine the amount of potential for yourselves.
For everyone that reads happy to discuss this or any other crypto project and hope to see everyone on the ride to the moon and beyond.