Tokenomics 101: Streamr Network $DATA
Examining the Tokenomics of the Decentralized Real-time Data Network
As the world continues to digitize, data has emerged as a valuable commodity, being collected, stored, and traded at an extraordinary rate. While social media platforms already earn billions of dollars by utilizing their user’s data to earn advertising fees (ca. $190bn in 2022), the Internet of Things (IoT) has given rise to countless connected devices that generate and transmit data constantly. With an estimated 75.4 billion IoT devices to be active by 2025 (an increase of ca. 245% since 2020), the sheer volume of data generated is staggering, with the potential to revolutionize the way we live and work.
Simultaneously, there is a megatrend towards distributed and decentralized data storage and distribution. This trend is primarily driven by the need to eliminate inefficient data silos and single points of failure. Conventional methods of storing and distributing data have several drawbacks, including a lack of resilience, susceptibility to cyberattacks, and concentration of power in a single entity (comp. Streamr Whitepaper). However, emerging decentralized storage systems like Filecoin, Arweave, and Storj, while being beneficial, are not suited for transmitting high volumes of real-time data due to their design.
Unstoppable data to unstoppable applications
This is where Streamr comes in - a decentralized network of thousands of globally distributed nodes that provides scalable, low-latency, and tamper-proof data delivery. The Streamr network enables anyone to monetize their data in a decentralized and permissionless manner while providing reliable and secure data streams for applications, such as dApps, that rely on them.
This article delves into the integration of the $DATA token into the Streamr network, how different user groups interact with the token, and the sources of its value. It aims to provide an in-depth exploration of the $DATA token and its role within the Streamr ecosystem.
To better comprehend the Tokenomics of Streamr, it's helpful to have a basic understanding of a relay network. Therefore, here is a brief explanation of what a relay network is:
A relay network is a communication system that uses intermediate nodes (relays) to transmit information between two or more endpoints that are not directly connected. Each relay receives the transmitted data and retransmits it to the next relay until it reaches the destination. This technique can be used to extend the range of wireless networks, to provide redundancy in case of network failures, or to improve network performance by reducing interference and congestion. Relay networks are commonly used in wireless sensor networks, mobile ad hoc networks, and satellite communication systems.
(A zoomable version of the diagram can be found here)
The Streamr Network is composed of five user groups that perform distinct roles and interact with the $DATA token in various ways. Let's take a closer look at each group and explore how they utilize $DATA within the network:
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If you’re interested in the condensed, need-to-know tokenomics information for Streamr including all the resources used for this article, check out the report on Tokenomics Hub.