SubQuery Network app review

SubQuery Network

SubQuery Network app review

Blockhain:

Acala Acala

User rating:

0/5 (0 votes)

Open Dapp

Basic info

  • Token SQT
  • Audited yes
  • DAO no
  • Yield farming no
  • Team public
  • Hacks no

Audits

Auditors:

Hacken

Hacken

Token profile

Price Market cap.

Frank Stewskid

Last updated: Nov 22, 2022

What is SubQuery

SubQuery is an open source decentralized data aggregator that allows for collecting and analyzing data from various blockchain networks, including Polkadot and all Substrate networks, Cosmos and all CosmWasm and Ethermint networks, Avalanche and Avalanche subnets, Algorand, and Terra. The platform allows blockchain application developers to extract, transform, store, and query data. Developers can focus on the development of basic use cases and application interfaces, without wasting time on the creation of their own backend for data processing. 

SubQuery has been developing since early 2021 by the OnFinality team. It had two rounds of investment in 2021, which resulted in the project receiving a total of $10.8 million for its development. Among the investors were Hypersphere, DeFi Alliance, Stratos Technologies, D1 Ventures, and others. Furthermore, SubQuery is also the recipient of a grant from the Web3 Foundation in 2020. 

How does SubQuery work

The SubQuery Network indexes data, making it available and verifiable for developers and their projects. Once a project is launched on the SubQuery Network, anyone can index it, and thus data becomes available to users around the world. Through the platform, anyone can create a so-called “SubQuery Project” - a set of instructions on how indexers are to navigate through a network, what data to collect, and finally - how it is to be displayed to users. The SubQuery team has provided various SDK tools to its users, aiding them in the creation of their own projects.

The SubQuery Network is comprised of four main user types. Consumers - these are users who request specific data from the SubQuery Network for their dApps or tools in exchange for which they pay an advertised amount of SQT tokens for each request made by their project. Indexers - users who run and maintain SubQuery projects through their own infrastructure (indexers can run both indexer and query services) while being compensated in SQT tokens for the requests they serve. Delegators, participate in the network by supporting indexers and receive rewards for doing so. The fourth and last group of SubQuery Network participants are so-called architects, these are builders of projects that the network runs on.

Consumers could be either individuals or organizations paying the project for processed and organized blockchain data, and pay a predetermined amount of SQT tokens for each of their requests satisfied by the network. The most common consumers are dApp developers, data analytics and blockchain companies, etc. 

Indexers are considered to be the most important members of the SubQuery network, as they are responsible for indexing blockchain data and providing it to customers. To receive rewards for performing queries, indexers are encouraged to stake SQT tokens on the specific SubQuery project to which they provide their service. The amount of rewards distributed to each indexer is determined by a Cobb-Douglas production function (simply put, this approach means that income is distributed among competing indexers in proportion to both query responses and bid amounts). To disincentivize misbehaving indexers (e.g., providing invalid, incomplete, or incorrect data), the platform transfers some of the misbehaving indexers' staked SQT to the SubQuery Foundation Treasury. Considering Indexers’ allocated stake amount depends on a percentage of their total SQT holdings, having their staked SQT cut down affects all rewards pools they are part of. 

Delegators are SQT token holders who choose to designate their tokens to indexers in exchange for a percentage of the rewards collected by them. This allows indexers to use these extra tokens to stake on projects on top of what they have already staked, thus increasing their income. Tokens can be delegated to one or more indexers for a reward (similar to staking). Thus, indexers rival to attract delegators by offering a competitive share of indexer rewards.

In order to encourage the indexing and support of new SubQuery projects, the project has provided consumers with a market mechanism named "Orders". It is used to signal indexers the emergence of new SubQuery projects. Consumers can broadcast a contract on the chain with a preset price and requested quantity, at the same time the indexer can view this content and execute the contract if interested. The mechanism can also be used with existing SubQuery projects to attract more indexers to improve competition and lower prices.

The last role is that of architects, who create SubQuery projects. They create and publish SubQuery projects for indexing and launching on the web.

How to use SubQuery

SubQuery is targeted mainly at developers. For the average user, there will be an SQT token staking application in the future. Since the project runs on the EVM-compatible Acala blockchain, users will only need to connect a wallet that supports ERC-20 tokens, such as Metamask. Then, they need to switch to the Acala network in their wallet. All SubQuery fees for transactions are paid in ACA tokens, Acala’s native cryptocurrency.

For developers, there is project documentation with comprehensive instructions on how to create projects in the network, run the SubQuery node, and interact with the SubQuery App. There is also a Testnet called “Frontier” allowing blockchain projects to be run on the platform’s infrastructure free of charge while providing all advantages of the SubQuery community. The Frontier Testnet can be used by Indexers, Delegators, or Consumers to run tests and debug their projects with the help of the SubQuery community.

SubQuery staking

In order to receive rewards from the query revenue, indexers are encouraged to bid SQT on the specific subquery projects to which they provide services. Indexers are in control of setting the indexer commission rate (ICR) - the percentage earned by them for providing their services to the network. The remainder is then distributed between the indexer and all delegators in proportion to the amount of staking/delegation. 

There is no minimum amount of tokens to be delegated in favor of indexers. Delegates receive income from staking only during epochs they have been part of since the start and until their end. A delegator can cancel their delegation (withdraw) tokens back to their wallet, but the funds will be blocked for 28 days.

The SQT token

The native SubQuery token is SQT. It is a service token that is designed to support the network, provide incentives for participation, and serve as a means of exchange for transactions in the subquery network. Consumers pay for the data they receive from indexers with SQT tokens.

The initial supply of the SQT token is ten billion and its inflation is set at around two percent per year. Inflation is needed for the SubQuery Foundation to support indexers early in the launch phase when there won't be many consumers. The token distribution is as follows: foundation and community 43.90%; team and partners 20.00%; series A round 15.00%; seed round 12.00%; public sale 9.10%.

Is SubQuery safe

An audit done by Hacken in April 2022, found no critical-risk issues in the SubQuery smart contracts, that were under review, however, there were two high-risk issues, one medium-risk issue, and five low-level issues. All of the findings from the audit have been since fixed by the SubQuery team.

SubQuery is developed by the OnFinality team. The team is headed by Sam Zou — an entrepreneur, and investor with more than 20 years of experience in IT, specializing in infrastructure development and cloud services. 

The CTO is Ian He —  a blockchain architect, and a member of polkadot-js, one of the first projects to implement Substrate technology. Ian took second place in the first Polkadot hackathon. 

The Head of BD is James Bayly —  infrastructure and applications architect, and award-winning software engineer.

Partners

SubQuery partners include major projects in the Polkadot ecosystem such as Nova Wallet, Nodle, Litentry, Interlay, Darwinia, Bit.Country, Pioneer, Bifrost, Manta Network, Karura, Crab Network, Moonbeam, Acala, Tapio, and Parallel. 

What's next

In the near future, the main network is expected to launch, followed by the TGE token. After that, the team plans to launch a liquidity mining program to increase the liquidity of the SQT token. 

According to the roadmap, the SubQuery Foundation is expected to launch in the third quarter of 2022 to administer the future governance and growth of the ecosystem. Initial ownership of the SubQuery Network will be held by the SubQuery Foundation. 

Over the long term, the team plans the transition of the project to its own parachain and integration with more ecosystems. Moreover, the team eventually sees SubQuery being managed by DAO.

Links

https://academy.subquery.network/

 

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