How to Earn on The Graph Network
In this guide, I will walk you through Curating and Delegating on The Graph network and how you can start earning on Web3.
This is a beginner’s guide, and it is my own perspective. Also, I will provide you with the most important resources to get started.
One of the Internet's strengths is its ability to help consumers find the right needle in a digital haystack of data.
Well, The Graph is the most important technological revolution in the history of the internet in my opinion.
To understand the need for The Graph you have to understand why Web3 is crucial in the first place.
Web2 vs Web3
The Web as today, also known as Web2, that is commonly referred to as the “read-write web”, is a total mess and that’s for a lot of reasons, but let me highlight some of them:
There is NO freedom - Companies control the content you are publishing and they make their own rules. Actually, they own your data and they are selling it.
Not reliable - Too many scammers, and frauds, and it is suffering data breaches all the time. So they are not just selling your data, in some cases, hackers are getting it for free, and using it in malicious activities.
Can be shut down - Governments and authorities can shut down your business/company, and in most cases, they have access to your customers’ data. Or a company can dismiss a product and you will end up losing all your data (think of how many products/companies went out of business in the last few years).
When it comes to Web3:
Freedom - You own your data. Basically, you don’t have to provide any personal information to interact with any Web3 dApp.
Reliable - Everything is recorded on a blockchain through smart contracts so it is trustless, safe, and will keep working no matter what happens because it lacks a central point of failure.
Just for you to understand, trustless is at the core of the blockchain technology and it means that even if you know nothing about a specific system or project, you can trust them because this is embedded in the core technology. This is exactly the opposite as the Web of today, where trusting an organization with your own data is quite difficult, because of the data breaches, or simply because most organizations sell your data since this is their business model.
Open-source - Anyone can review the code, which is not influenced by a central government, and not controlled by a sole party.
This is just a quick glance. For more information about Web3, I recommend you read this article by Nader Dabit: What is Web3? The Decentralized Internet of the Future Explained.
Why do we need The Graph?
How blockchain data is stored?
In simple terms, a blockchain is decentralized and hence there is no central place for it to be stored. That’s why it is stored in computers or systems all across the network. These systems or computers are known as nodes. Each of the nodes has one copy of the blockchain or in other words, the transactions that are done on the network.
However, that data is not stored in a format that can be consumed directly, and dApps can’t use it without building an entire backend to manipulate, filter, sort, etc… it.
And this is just time and resources consuming.
What is The Graph?
The Graph is an indexing protocol for querying networks like Ethereum and IPFS. Anyone can build and publish open APIs, called subgraphs, making data easily accessible.
Subgraphs can be composed into a global graph of all the world's public information. This data can be transformed, organized, and shared across applications for anyone to query with just a few keystrokes.
For more information, I recommend you read the following articles:
The Graph vs Google
Now let’s dive into the main topic of this article.
How to earn on The Graph network
1. Delegating
Being a delegator is the simplest thing you can do on the network. You delegate your tokens to an indexer and you start earning passive income. You don’t need any technical skills, you just need some GRT in your wallet and you are ready to go.
How to Delegate?
The following guides will help you get started:
How much can I earn?
Well, it varies a lot, depending on your indexer, but the average APY is 9-17%.
Decentralization always matters so try to distribute your GRT to multiple indexers and let’s secure the network!
Delegating vs Binance staking
Binance is providing a high APY right now through GRT staking, but there are some negative sides you have to be aware of. Please read this article by Paolo Diomede to understand why you should delegate on the network instead of staking on Binance: Binance Staking vs. Delegating with The Graph network.
Delegators resources
Graphtronauts website - They are providing a great tool where you can find indexers’ APY, ratings, reviews by delegators, and a lot of other important information.
Graphtronauts Telegram - It is the best place where you can find help and answers to your questions.
The Graph Rewards tool - GRT Delegation rewards calculator.
Graph scan by Ryabina - It’s a useful dashboard to evaluate indexer partnerships and to track GRT rewards earnings.
The Graph Academy - Everything you need to know to thrive as a Delegation Virtuoso of The Graph.
2. Curating
Curation is an essential component of the data economy. Data is the world’s most valuable asset – but only if it is useful, accurate, and reliable.
To be a Curator, you need to have some technical skills, and the risk level here is high.
How to Curate?
By signaling a subgraph, you are telling the indexer that this subgraph is legit and will generate query fees. Based on that, indexers will index that subgraph and you will have a share of the rewards.
There are multiple variables in the game but the most important two are:
Your place in the bonding curve - If you signal some GRT early, your shares will be worth more than if you signal late.
If you don’t know what a bonding curve is, read this article: An Introduction to Bonding Curves.
The query fees generated by the subgraph. For example, if subgraph A is generating 1000 GRT per day as query fees and there are 100 shares minted, then each share will receive 1 GRT daily. That’s because, Curators get 10% of the query fees, while the remaining 90% goes to indexers. But if that subgraph A has 50 shares minted, then each share will receive 2 GRT daily.
How much can I earn?
I can’t give you an estimation because it depends on the efforts you are putting in here. You can make x5 or x10 if you signal a big subgraph early, and you can lose 40% or 50% if you signal a bad/fake subgraph. Also, the % of the APY you will earn through query fees varies based on what I explained earlier.
For an insight:
The Curator above made 254% through 1 signal. He signaled early on DODO with 25k, and his shares are now worth 88.5k.
At the same time, the Curator above lost 48.6% because he signaled the fake UniSwap subgraph.
Curators resources
GRT Curation Station Discord server - This is the best place for Curators. Ask for help and the community will answer your questions.
GRT Curation Station Telegram - A popular Telegram group to discuss curation and newly deployed subgraphs, it is also very useful to spot fake subgraphs.
Curators by The Graph academy - Learn everything you need to know about Curators and their role in The Graph Network.
Data Nexus YouTube channel by Derek - He has some great videos for beginners.
Also, you can earn by being an indexer. Indexers operate nodes in The Graph network to earn indexing rewards and query fees. The role of an Indexer is especially suitable for users with advanced technical skills who are comfortable in setting up and running a node. There are some requirements like a minimum stake of 100k GRT. Check out the requirements here.
Since this is a beginner guide, I will not cover “how to become an indexer” because it is a huge topic. But I will leave some resources for you to go through if you are interested:
Indexers resources
The Graph official Discord server - This is the best place to get started, you can find channels like #indexers and #indexer_software which are very helpful.
Important resources
GRTiQ podcast - It is a reliable source of information related to The Graph. You can listen to The Graph founders, indexers, developers, partners, and a lot more.
The Graph forum - Involve with the community and share your thoughts, questions, and suggestions!
That’s all for today!
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Leider erst heute komplett gelesen. Dankeschön Ahmad. 👍🎖️ Wie können in Zukunft die falschen Subgraphen von Curatoren erkannt bzw. Aussortiert werden!?..