Proposal to Whitelist GRT

Proposal to Whitelist GRT token on the Bancor DEX and add 1M BNT cap co-investment by the protocol.

TLDR:

  • Graph is one of the growing “blue chip” defi assets with more and more traction.
  • Graph is the market leader in providing data for Defi leading applications.
  • Graph Uniswap pool is shallow and can be outcompeted by Bancor.
  • Graph has significant capital and institutional backers to expand and grow long term bringing value to BNT network.

Token contract address:

0xc944e90c64b2c07662a292be6244bdf05cda44a7

Project website:

Discussion

The Graph is a protocol for organizing blockchain data for over 1000 projects and making it easily accessible. It’s powering many of the most used applications in DeFi and the broader Web3 ecosystem today such as:

  • Uniswap
  • AAVE
  • Genosis
  • Melon
  • Cream
  • Coingecko
  • Synthetix
  • Aragon
  • Balancer
  • Opyn
  • Wrapped BTC
  • Nansen
  • Messari
  • Loopring
  • Kyber Network

And more

Currently, The Graph’s hosted service is processing over 4 billion monthly queries for data like token prices, past trade volumes, and liquidity.

The Graph Network mission is to create an open marketplace of Indexers and Curators that work together to efficiently index and serve all the data for DeFi and Web3 in a decentralized way.

Staking Opportunity

Currently Graph offers relatively low staking opportunities with 6% APR where, if you delegate tokens, a portion of it is confiscated by the node owner.

Considering the above, if providing liquidity to the BNT pool can outcompete 6% APR of GRT staking opportunity the network can expect significant inflow of capital.

Investors

GRT is backed by tier one investors which makes the project a reliable asset to be listed on BNT platform.

  • DT Capital Partners
  • Kilowatt Capital
  • Multicoin Capital
  • Tally Capital
  • ParaFi Capital
  • Framework Ventures
  • Digital Currency Group
  • Coinbase Ventures
  • Lemniscap

Tokenomics & Token Metrics

Graph has raised 12M USD in both, private and public roud. Moreover, currently only 10% of GRT tokens are in circulation which gives foundation significant cash reserves for further development.

There are multiple ways to contribute to The Graph Network and the open data economy for both technical and non-technical individuals.

Indexers (Earn GRT)

Indexers are node operators in The Graph Network that stake Graph Tokens (GRT) in order to provide indexing and query processing services. Indexers earn query fees and indexer rewards for their services.

Curators (Earn GRT)

Curators are subgraph developers, data consumers or community members who signal to Indexers which APIs should be indexed by The Graph Network. Curators deposit GRT into a bonding curve to signal on a specific subgraph and earn a portion of query fees for the subgraphs they signal on; incentivizing the highest quality data sources.

Delegators (Earn GRT)

Delegators are individuals who would like to contribute to securing the network but do not want to run a Graph Node themselves. Delegators contribute by delegating GRT to existing Indexers and they earn a portion of query fees and indexing rewards in return.Technical Level Required: Low

Consumers (Pay GRT)

Consumers are the end-users of The Graph that query subgraphs and pay query fees to the Indexers, Curators and Delegators. Consumers are likely to be developers or projects themselves that cover query fees for their applications as they would AWS or cloud service costs.

Community and Communication

GRT currently has 163 Data Curators (nodes owners) https://network.thegraph.com/

Telegram members activity is recording stable growth and currently has recorded 22K unique active users. Discord has 17K active members

Github activity is also growing in a stable way over the last two month.

Available Audits

Market and Trading Data

Graph trading volume on both centralized and decentralized exchanges is equal to around 400M where the majority of trading is going on CEX.

Thanks to adoption and usability of the protocol, Graph recently has achieved rank 50 on coingecko and become considered as one of the Defi bluechip

As we can see below, Uniswap GRT/ETH pair is the main market for GRT on DEXes, wich average daily volume of around 3M USD and liquidity around 6M USD. This gives Bancor an opportunity to become the deepest pool for GRT on DEX market and take over most of the volume.

What is also worth mentioning is a USDC pool with almost 5M liquidity and 3 times lower volume then ETH pool.

Pool on Sushi is irrelevant

The average on chain transaction size is around 20K which is currently in the range of the most common transactions size on Bancor network.

What is worth to mention, the Graph has got criticized because of unusual volatility. As we can see on the chart below, the annualized volatility is decreasing making the asset more stable and less severe in regards to IL.

References

https://network.thegraph.com/

Data

https://app.intotheblock.com/coin/GRT

https://info.uniswap.org/pair/0x2e81ec0b8b4022fac83a21b2f2b4b8f5ed744d70

6 Likes

Quick aside, the price has about doubled since those volatility chart, funny.

Just pointing out that

Currently Graph offers relatively low staking opportunities with 6% APR

is not right. The APY depends on the indexer, but there are many with 10-20%+. The one I’m with is 20%+. Some of the ones trying to attract initial delegators would even offer lucrative 60%-90% APY (mine being one of those previously.) Once the tokens are delegated, it becomes systematically disencouraged to withdraw them within a short time frame.

Why I am saying this is because BNT pool has to outcompete that to attract LPs. Bit of a double whammy in that the rewards are in BNT obviously, so the protocol token itself would have to compete with the high traction explosive growth of the GRT token in terms of value.
This means the mining reward for the BNT/GRT would have to be high, at least comparable to WBTC, on the GRT side imo. Actually maybe even higher than that, as it’s not like there is a way to natively yield-farm WBTC.

1 Like

Hey

Thank you for the valuable feedback, I took the average staking from the https://www.stakingrewards.com/ is there any way to check more efficiently the staking rewards per indexer? If users have to check it manually and relocate assets every time the rewards decrease then this system is not efficient enough the maintain a low churn rate of stakers. Therefore I think, our solution is more suitable in regards to ‘stake and forget’ approach than GRT staking which requires constant stakeing optimization.

3 Likes

I support whitelisting GRT and offering Rewards. Graph is a blue-chip project that will clearly be in top 10-20 soon.

2 Likes

Yep, I’m not sure what the formula is specifically or who built this site, but https://the-graph-rewards.com/ lets me plug in the address of each indexer to check the APY. Based off my own first-hand rewards and calculations, it’s quite accurate.
GRT dis-incentivizes delegation “jumping” by imposing a 5% deduction when delegating + a 28-days unbonding period. This translates to: users are encouraged to stay delegated with their first indexer for at least a few months time, thereby creating a “who can attract the (new) delegator/provider first” situation that liquidity pools would be competing with.

To be clear, I think it’s very reasonable to create and whitelist a BNT/GRT pool, but it’s also going to cost us (in high yield rates/BNT dilution because we’d have to offer mining rewards to deepen the pool) if we want to attract LPs who:
a) are new GRT-hodlers savvy enough to do the math, and/or;
b) prefers native-to-token yield farming, and/or;
c) already delegating within the Graph’s ecosystem.

Fully support both BIPs for GRT whitelisting and liquidity incentives as this is going to be a MAJOR blue chip project in the space. Thanks for writing this up Michael!

Fully support the whitelisting and LM incentives.
GRT is aiming up to be a massive blue-chip, which fits exactly in our pool portfolio.

2 Likes

100% with this proposal. GRT is only growing with defi.

Fully agree. Nothing more needs to be said.