Blockchain data startup The Graph has raised $5 million in a token sale with Framework Ventures, Coinbase Ventures, CoinDesk parent Digital Currency Group, Multicoin Capital, DTC Capital and others.
The funding round follows a $2.5 million venture capital round early last year. The new token sale used the “simple agreement for future tokens” (SAFT) format for accredited investors.
The Graph CEO Yaniv Tal said “thousands” of developers already use the startup’s tools, including the teams behind the decentralized exchange (DEX) Uniswap and the token-fueled Aragon project.
His startup created an indexing protocol for organizing blockchain data so people can access it. People use The Graph’s open-source software to search for specific Ethereum data, the same way we search Google for a recipe, sometimes instead of running their own Ethereum node.
Uniswap co-founder Hayden Adams said a considerable portion of the DEX ecosystem is reliant on nodes operated by Infura, the ConsenSys-owned API provider. Likewise, The Graph offers another tool for companies that want to offer Ethereum-related services regardless of direct participation in the blockchain network.
“We use [The Graph] for Uniswap.info, our analytics site,” Adams said. “As a company we don’t manage or run our own databases. … Right now it’s pretty difficult to get historic data from the Ethereum blockchain in an efficient way.”
Since The Graph freely provides open-source software, and isn’t promising prompt revenue, any investment in its tokens may be a signal the investor is bullish on Ethereum applications.
“We haven’t shared the token distribution yet,” Tal said when asked about the token sale and strategy.
Instead, he said his startup’s staff of 17 is “taking a similar path as Compound,” the decentralized finance (DeFi) startup that also attracted investment from Coinbase and recently inspired the “yield farming” craze with the issuance o...