Preface

One of the main features of the Blockchain network is the transparency of transaction data, which allows for all user transactions to be recorded on-chain. Whether it's cryptocurrency transactions, lending, minting and trading of non-fungible tokens (NFTs), all this information is permanently stored on-chain. With the development and maturity of smart contracts, an increasing number of on-chain projects are emerging. The Blockchain is becoming a large-scale database where all data interactions with the Blockchain can be recorded, and this is known as on-chain data.

On-chain data is crucial for this rapidly changing market and can be roughly divided into three categories: transaction data (including data on transaction information, such as transfer amount, sender and receiver addresses), block data (information on the block itself, such as timestamps), and smart contract code (encoded business logic on the blockchain). Although on-chain data is publicly transparent, it is difficult for users to directly query blockchain data for answers. If they want to analyze it themselves, they need to set up nodes to obtain blockchain data and process it, which is obviously a time-consuming and labor-intensive process. Therefore, to enable fast retrieval of on-chain data, many on-chain data analysis platforms have emerged in the market. With the rapid development of blockchain, the on-chain data analysis industry has also grown rapidly, and products with different focuses have been launched for individual and institutional users.

The current mainstream on-chain data analysis platforms will store the indexed raw on-chain data in a data warehouse that is responsible for updating and managing by the platform after a series of processing. Currently, it can be roughly divided into:

(1) Data collection category: If the MetaMask platform chooses to build its own Node to obtain on-chain data, it may require a large amount of funds and time, and may also face the risk of memory leaks. Therefore, the platform usually accepts help from third parties to collect data. Third parties are usually Node service providers, and currently well-known service providers include Infura, Quicknode, etc.

（2）Data query category: Data service providers that provide data query services, through parsing and formatting of data, create visualized data to make the original data more accessible. For example, The Grap is a Decentralization search engine used for indexing and querying blockchain data.

(3) On-chain data analysis: After the on-chain data analysis providers collect, process, and integrate all the data, the final results are reported and delivered to clients in real time by on-chain data analysts. Clients are usually institutions or individual investors. For example, the Dune Analytics data platform supports the querying and analysis of on-chain data, and reports generated by numerous excellent analysts are delivered to clients.

Subsquid Network is a Decentralization query engine that extracts a large amount of on-chain data for optimization. It ensures data security through Zero-Knowledge Proof technology. Currently, it provides on-chain data for over 100 EVM and Substrate networks, including event logs, transaction receipts, traces, and the state differences of each transaction. This article will provide a detailed overview of its main features and characteristics, as well as a detailed analysis of its Token model and development status.

Introduction to Subsquid Network

Subsquid Network is a query engine based on SunstrateBlock chain, which can efficiently aggregate on-chain and off-chain data, and protect it through Zero-Knowledge Proof technology. As a worker network of Decentralization, each Node is responsible for storing data from specific Block subsets, speeding up the data retrieval process by quickly identifying Nodes that save the required data, allowing developers to obtain data at low cost, personalized, and real-time. In addition, the protocol also supports real-time indexing, allowing indexing before the Block is finally determined. It also supports storing data in formats selected by developers, making it easier to analyze using tools such as BigQuery, Parquet, or CSV.

The project launched an incentive test network on CoinList in September 2023, attracting nearly 20,000 developers and participants. On June 3rd this year, Subsquid Network launched its Mainnet data lake. On January 19th, CoinList announced the start of the Subsquid (SQDToken) community sale, and officially released the native Token SQD in mid-May this year.

The project was founded by two co-founders, one of whom, Marcel Fohrmann, attended the Stanford Graduate School of Business; the other co-founder, Dmitry Zhelezo, is a Ph.D. in mathematics, and was previously the core developer of Hydra at Jsgenesis, and also served as Chief Scientist at Helix Cognitive Computing, with over 8 years of development experience.

The team raised $3.8 million in seed funding in November '21, led by Hypersphere Ventures, with participation from Zeeprime Capital, Lattice Capital, Digital Finance Group (DFG) and others. protocol has also continued to expand partners, and has launched strategic cooperation with Polkadot ecological prediction marketZeitgeist, blockchain venture capital fund NewTribe Capital, Germany Telekom MMS, etc.

Main Products

Indexers allow for complex queries, easily filtering and extracting data based on different criteria. Some also allow for aggregating data from multiple sources, avoiding the need to deploy multiple APIs in multi-chain DAPPs. Distributed across multiple Nodes, indexers provide enhanced security and performance.

The products currently offered by Subsquid Network include the following four:

(1) Squid SDK: is a set of open source TypeScript libraries for retrieving, decoding, transforming, and storing data from the Subsquid network. It can also provide transformed data through APIs without accessing archival RPC. All stages of the indexing pipeline (from data extraction to transformation to storage) are performed on batches of blocks to maximize indexing speed. The modular architecture of the SDK allows for the use of custom plugins and data target extensions for indexing projects.

(2) Subsquid Cloud: A hosted service for custom indexers and GraphQL APIs. By joining this product, developers no longer need to worry about the maintenance cost and trouble of index infrastructure.

Image source: https://www.sqd.dev/cloud

(3) Subsquid Firehose: A lightweight adapter for running subgraphs against the Subsquid network, running as a sidebar for the graph indexer Node, extracting and filtering data directly from the SQD network instead of RPC endpoints. However, since the network does not provide real-time Blocks, there is an option to fetch the latest and incomplete Blocks from the supplemental RPC endpoints in a seamless manner.

(4) ApeWorx Subsquid Plugin: A modular Web3 development framework for Python programmers that can batch retrieve blockchain data. It can be used to retrieve historical data of individual accounts, but the plugin is currently in the testing phase.

Product Features

Indexing on-chain data is crucial for building Web3 DApp and analysis dashboard. Based on Squid SDK, the protocol currently provides the following features:

(1) Efficient Data Indexing

Subsquid provides an efficient data indexing system that enables developers to access blockchain data quickly and accurately. By optimizing data structures and query mechanisms, data access speed is significantly improved.

(2) Flexible Query System

Subsquid supports a flexible query system, developers can customize queries as needed to retrieve specific blockchain data. This flexibility is suitable for various applications, such as Decentralized Finance (DeFi), games, and Supply Chain management.

(3) Comprehensive Data Coverage

Subsquid currently provides historical on-chain data obtained from over 100 EVM and Substrate networks as well as Starknet. The data covers event logs, transaction receipts, traces, and state differences for each transaction.

Image source: https://network.subsquid.io/dashboard

Before the Mainnet launch, accessing data from the Subsquid network is free. Starting from June this year, when the Data Lake Mainnet is launched, the cost of extracting 1TB of data is expected to be between $1 and $5.

Economic Model

SQD is the native Token of Subsquid Network, with a total supply of 1.337 billion Tokens, and the TokenSmart Contract is deployed on the ETH mainnet and bridged to Arbitrum One.

Subsquid Network launched its incentive testnet on CoinList in September 2023, attracting nearly 20,000 developers and participants. CoinList started the SQD community sale on January 19th, 2021 at 02:00 (UTC+8), with an initial token supply of 53,480,000 SQD (4% of the total supply) at a price of $0.094 per token. The initial purchase limit is a minimum of $50 and a maximum of $2,000 (USDT or USDC only). 20% of the tokens sold in the initial sale will be released after the TGE, with the remaining tokens being linearly released over the next 6 months. Participating in the sale is not available for residents of the United States, Canada, China, South Korea, and certain regions. Additionally, Subsquid may choose to sell an additional 13,370,000 SQD tokens (1% of the total supply) during the Subsquid community sale. Therefore, the total percentage of tokens sold during the community sale is 5%.

The official has announced the token allocation details and unlocking schedule of SQD, as shown in the table below:

Image source: https://docs.sqd.dev/subsquid-network/tokenomics/

SQD is currently participating in ecosystem activities, mainly used for protecting network operations. The main application scenarios can be divided into the following aspects:

(1) Used to reward Node operators who contribute computing and storage resources to the network;

(2) Used for the management of network participants. Through delegation, the design of SQDToken includes built-in Node supervision, making it easy to choose trustworthy operators and reward them without permission;

(3) By locking SQD tokens, data consumers can increase the rate limit;

(4) For governance voting, SQD holders can participate in governance and vote on protocol changes and other proposals.

Summary

Subsquid efficiently aggregates a large amount of on-chain and off-chain data, protected by Zero-Knowledge Proof. The unique modular architecture allows developers to have the best flexibility and customization. The team's vision is to become a unified data center for Web3, planning to build and prepare all data from all chains, with plans to support expansion to large ecosystems such as Solana, ETH, and Layer2. With the rise of data storage and network participation, Subsquid Network has great potential for future development.