Montreal’s dfuse, now called StreamingFast, will take on a $74.8 million (US $60 million) grant from The Graph Foundation in order to to join its ecosystem for indexing the decentralized internet for search purposes.
“It’s the closest thing to an acquisition in the decentralized web business, but it doesn’t quite count as one,” writes VentureBeat‘s Dean Takahashi.
Under the deal, StreamingFast will join as a core developer in The Graph’s ecosystem in order to “build a radically more open Internet.” The Montreal outfit will retain ownership over its brand and personnel, and it will become a core protocol developer and open source contributor in The Graph’s ecosystem.
StreamingFast will work alongside Edge & Node, a software development company dedicated to the advancement of the decentralized Internet.
Meanwhile, StreamingFast is buying out its existing investors, including local investors Diagram Ventures and Panache Ventures, and White Star Capital, based in New York and Montreal.
More on the nature of the grant
Some readers have commented on the framing of the deal as a “grant,” particularly as it applies to a company receiving $75 million in capital. Surely the situation involves some form of indenture, and not merely one in which StreamingFast is free to do as they please.
The Graph’s Tegan Kline told Takahashi that the grant is the “first of its kind, enabling an experienced development team to become dedicated to working on an open source protocol.”
“It’s just a grant, as opposed to one centralized company taking control of another centralized company, and then kind of bringing them in to destroy competition,” Kline said. “Instead, it’s like allowing them in, in an autonomous way, so that they have that choice. They’re not doing that because of contracts. And because of money, they’re actually making that choice to join this different movement. So it is very similar to an acquisition, without the red tape.”
What is The Graph Foundation?
The Graph calls itself the indexing and query layer of the decentralized web. Developers build and publish open APIs, called subgraphs, that applications can query using GraphQL. The Graph currently supports indexing data from Ethereum, IPFS, and PoA with more networks coming soon.
Over 16,000 subgraphs have been deployed by 20,000 developers for applications, such as Uniswap, Synthetix, Aragon, Gnosis, Balancer, Livepeer, DAOstack, AAVE, Decentraland, and many others.
“We want to make decentralization real and ubiquitous. Bitcoin was the first blockchain that proved that crypto economics can be used to secure a global decentralized ledger. Ethereum expanded on that idea by making it possible to run user defined programs on blockchains, opening up a world of possibilities for designing protocols and economic systems that can run on a provably neutral substrate,” writes The Graph.
Takahashi explained that The Graph Foundation believes the internet will move to the blockchain and will need its own search service, like a Google for blockchain. It has begun the work of indexing the blockchain and all of the transactions recorded on the ledger. This will enable it to create a search engine that people can use to search through blockchain data as public record.
“The Graph indexes all of the blockchain data, and serves that data,” Kline told the news website. “So it’s how developers access data and serve it to their users, just like how Google set out to index the web back in the day.”
How does StreamingFast play into the equation?
StreamingFast, notes Takahashi, will focus on a common open-source protocol. Its relevant application programming interface (API) products will also be migrated to The Graph, which will help improve indexing performance and augment the network’s back-end querying services.
Moreover, The Graph Foundation purchased a portion of StreamingFast’s intellectual property and will open-source it as well.
According to VentureBeat, StreamingFast will start effective immediately by supporting The Graph as it continues its multi-blockchain expansion. Its engineers and project managers will also work on subgraph development, support for new Layer 1 protocols, core protocol development, indexing and performance improvements, contributing to the governance process, development tooling and education.
“We truly believe that protocols will eat the world and today’s announcement exemplifies this,” CEO Marc-Antoine Ross told the news website. “We launched the company three years ago with the vision to build a traditional SaaS model but soon realized the powerful coordination and incentive mechanisms of protocols and Web3. With this core dev grant, we are paving the way for an alternative path for traditional VC-backed businesses operating in Web3.”