The inception of smart contracts has been very revolutionary in the technological and financial sectors. Smart contracts allow developers to create decentralized applications based on Blockchain.
However, like other developers, smart contract developers suffer the problem of lacking good access to reliable databases. The Graph Protocol was launched to offer DApp developers more streamlined access to blockchain-based databases.
What is The Graph?
The Graph Protocol defines itself as an indexing protocol designed to query networks like IPFS and Ethereum. This platform allows anyone to create and publish Subgraphs in a mission to streamline access to data in blockchains. It powers both the Defi space and Web3.0 ecosystem.
The Graph Protocol has a native token GRT which is the main asset of the ecosystem. Due to the Graph protocol’s popularity, some may want to invest in the token. However, investors need to know the use cases of the GRT token before investing. This guide looks at the three everyday use cases of GRT.
GRT Use Case: Used by Network Contributors
This use case is only specific to the network and is relevant within the ecosystem. According to the website, participants of the Graph ecosystem will receive incentives for their contributions.
The website has three types of contributors available include;
- Indexers. These are a group of people who run nodes and process queries. They need expert-level developing knowledge to be able to contribute. However, this group must stake some GRT tokens to contribute to the network. The result of their work is a reward in GRT tokens.
- Curators. Curators require medium knowledge on developing but a good understanding of crypto. They need to evaluate subgraphs to see their quality. They can show their trust in a subgraph by staking GRT tokens. Once they stake GRT, they will earn rewards in GRT as a portion of fees, as the subgraph receives more signals from indexers.
- Delegators. Delegators do not need any technical experience. They stake GRT tokens aiming to support the network indexers. They receive some of the indexing and query rewards.
Therefore, the graph token gets a significant use case within the network. It is staked by indexers, delegators, and curators to contribute to the network. Also, it’s the token used to reward contributors.
GRT Use Case: Medium of Exchange for Consumers
One of the prominent use cases of the graph token is as a medium of exchange. The token will help as a payment asset for different services within and out of the ecosystem.
Of course, many are already utilizing the data solutions the Graph protocol provides. There are consumers of different services. For instance, some consumers will need their queries to be processed within the network. These queries may include access to data from some top platforms hosted by The Graph.
Decentraland is an excellent example of a network whose subgraphs developers can access. Others include Uniswap, Aave, Synthetic, and others. Infact, when writing this report, there were already thousands of subgraphs deployed in the Graph protocol. Each subgraph has its own set of people who need their queries processed.
When the different contributors require service provision, they pay for the services using GRT tokens. In one of their blogs, the platform gives a step-by-step guide on how their billing process with GRT works.
Their billing system is based on Polygon but uses GRT token as the primary medium of exchange. People who need access to Decentraland, Aave, Synthetix, and Uniswap Subgraphs use GRT tokens as payment for the services they receive.
According to their website, every consumer of the network’s services uses the GRT token to settle for the processing fee. Since developers and Defi networks are the most popular network users, they use the token to settle the charges.
GRT Use Case: Philanthropic Activities
Another widespread use case associated with the Graph network and GRT token is philanthropic activities. This token can be used in donations within and without the ecosystem, specifically for charitable benefits.
One of the most outstanding examples of GRT as a philanthropic token is its use in the Giving Block. The Giving Block released information announcing that it added Graph (GRT) support for donations and charities.
The GRT token could now be used as a donation asset for over 250 non-profit organizations. Using the Graph Tokens and network, the Charities can support the decentralized web, WEB 3. Charities will be free to participate as Curators, delegators, or indexers.
Some of the top global charity networks like United Way Worldwide, the American Cancer Society, and Direct relief accept crypto donations. Crypto assets are better when it comes to tax savings. Hence, the best way to support a non-profit organization is by donating cryptos like GRT.
GRT, the Token with Multiple Use Cases
This guide has been looking into the Graph token (GRT), mainly focusing on its use cases. Among its use cases include the medium of exchange and philanthropic activities. Already, there is lots of hype and high expectations around The Graph.
In 2021, The Graph Protocol was among the most successful crypto projects. For instance, in November 2021, Vitalik Buterin, the CEO of the Ethereum network, announced plans to scale Ethereum using The Graph Protocol. Understandably, crypto analyst Asit Sharma mentioned The Graph Protocol as one of the future game-changers in the Defi space.
The two examples show that the network has such high prospects for the future. However, it goes without saying that this project would be much more successful if it linked other smart blockchains like BSC, Solana, and Cardano. It would access more decentralized data and benefit developers in different chains.