The Graph - a service that helps applications collect and interpret blockchain-based data - announced Thursday that it will phase out its centralized hosted service early next year.
Representatives from Edge & Node, the original team behind The Graph, did not give an exact date for when the free hosted service will be phased out. They say app developers using the platform will be encouraged to switch to the paid Graph network, which relies on a distributed community of Ethereum-based "indexers" to process data, rather than the single operator of the hosted network. GRT is the native token of The Graph.
"This big vision that we've been trying to fulfill for years is now possible, and the big part of it is that you can decentralize data," Eva Beylin, director of the Graph Foundation, told CoinDesk. "This vision of open data - owning your own data - is now possible because you're now relying on a network, not a company or an operator."
The announcement, made at The Graph's "Graph Day" conference in San Francisco, marks a major step toward decentralization for the self-proclaimed "Google of blockchains." The announcement comes alongside new features and updates to The Graph's core technology that will soon make the free hosted service obsolete, according to protocol officials.
The news was also accompanied by a proposal to expand The Graph's decentralized network to include Arbitrum, an Ethereum scaling solution with faster speeds and lower fees.
As The Graph works to discontinue its centralized hosted service, leading voices in the tech and crypto world are voicing concerns that centralized infrastructure providers - services like The Graph's hosted service that run most major Web 3 products in the background - threaten the crypto promise of "decentralization."
What is The Graph?
Proponents of blockchain technology often tout it as a way to make data open and transparent.
The reality, however, is not so simple. Just as it was difficult to browse the Internet before the advent of search engines, today's blockchains are a collection of bits and bytes that are difficult to interpret without the help of specialized tools. Blocks on a blockchain are simply lists of transactions - in a sea of NFT sales and token swaps, individual transaction data doesn't mean much on its own.
This, Beylin says, is where The Graph comes in.
"The point of The Graph is to organize blockchain data and make it easily accessible," she told CoinDesk. "That can be for an app, a data dashboard, or just regular analytics."
App developers can configure their smart contracts so that their data can be interpreted by The Graph and converted into what are called subgraphs. That's kind of like how websites create an index file so they can be crawled by search engines.
"A subgraph can be anything from financial metrics ... to things like art statistics to things like voting metrics or proposals," Beylin explained.
The graph has been adopted by a long list of significant projects - from the Bored Ape Yacht Club's NFT collection to sushi's decentralized exchange service - that benefit from the ability to collect and process large amounts of blockchain data.
Decentralization of blockchain data
Bitcoin emerged in the wake of the 2008 financial crisis as a way to take power away from a rigged financial system. Smart contract platforms like Ethereum expanded on that vision. By distributing power across a vast network of operators, these networks would theoretically enable builders to create products beyond the reach of greedy institutions and corrupt bureaucrats.
Blockchain critics will say that this promise of "decentralization" is pure marketing, and they are right. In recent years, centralized services - from exchanges like Coinbase to infrastructure providers like Alchemy - have sacrificed some of the core promises of blockchain technology for the sake of convenience. Running a node is difficult.
Beylin says The Graph launched its centralized hosted service in 2018 as a way to bootstrap the platform.
As for why the team wanted to phase out the service "from the beginning," Beylin explained that "the Hosted Service is a single operator, which means there's a single server or database processing queries, which leads to potential single points of failure."
According to Beylin, The Graph's hosted service is theoretically vulnerable to the same vulnerabilities (data censorship, service outages, etc.) as the Metas and Amazons of the world - the same companies The Graph wants to disrupt.
On the other hand, The Graph's decentralized network, launched in 2020 and now comprising more than 160 individual "indexers," is presented as a more decentralized alternative.
"With the decentralized network, people get the assurance and reliability that their queries will be answered at any given time," Beylin said.