Arweave (AR) Protocol Guide: Permanent Decentralized Data Storage Solutions

[00:00:01]in january 2020 the united states national archives was caught altering an image from 2017.

[00:00:09]this was and is a big problem because the whole point of archiving is to preserve information forever without changing it r weave is a crypto project that aims to archive the world's information in an immutable way and over the last year it's partnered with major cryptocurrencies to permanently store their transaction histories today i'm going to explain what our weave is bring you up to speed on some of the project's most important updates and tell you why it's ar coin is on track to become one of the most valuable cryptocurrencies [Music] i know you're ready to rumble but there's a disclaimer i need to unbundle giving you any kind of financial advice would get me in trouble all i can give you is facts and stats that will help you navigate the crypto jungle please contact a financial advisor if your portfolio is about to crumble also note that i hold ar as part of my personal portfolio but i'll keep my analysis humble if you found this video on your youtube homepage my name is guy and today is your lucky day that's because the coin bureau is home to the highest quality crypto content a mere mortal can convey coins tokens news reviews and complex crypto concepts explained in a simple way if you want to stay subscribe to the channel and ping that notification bell without delay if you have things to do i've left timestamps in the video timeline just for you you can use them to skip ahead but be warned that you may miss out on important truths now that you're in the groove let's see what our weave has been up to and why ar could be about to moon if our weave is new to you here's the abridged explanation our weave was founded in 2017 by computer scientists sam williams and william jones and it was built by their software company called minimum spanning technologies are weave's ecosystem growth is overseen by the open web foundry an accelerator and incubator program for our weave projects that's presumably operated by minimum spanning technologies ah we've raised 22 million dollars across various icos in 2017 2018 2019 and 2020 and are weaves mainnet launched in june 2018.

[00:02:32]fun fact are weaves mainnet launched on the anniversary of the publication of george orwell's famous dystopian novel 1984 and this is because fighting against the kind of terrifying totalitarianism described in the book is one of the reasons why our weave was founded in the first place our weave hopes to achieve this by doing what i mentioned in the introduction archiving all the world's information forever in a manner that can't be modified our weave's creators argue that this permanent preservation of the past is paramount to preventing 1984 scenarios from arising in the future the ability to store information for an indefinite period of time with a single payment is what makes are weave different from other decentralized storage cryptocurrencies which employ a pay-as-you-go model now this is possible because of our weaves unique architecture and its elaborate economics in contrast to other cryptocurrencies are weave doesn't use a blockchain per se instead it uses something called a block weave to incentivize miners on its network to store as much information as possible for as long as possible to successfully minor block and earn block rewards miners are asked to show that they're storing data that was a part of the previous blog as well as another randomly selected block called the recall block if the miner can't prove they have the data in the recall block they don't earn block rewards now this incentivizes miners to store as much of our weaves data as possible even though they're not technically required to do so because otherwise they run the risk of not earning block rewards this unique consensus mechanism is called succinct proofs of random access or spora and it uses a combination of factors such as storage capacity internet speed and computing power to determine which miner gets to minor block fun fact spora leverages monero's random x consensus as part of its minor selection process and are we've co-founder sam williams actually helped develop random x while it's not entirely clear how profitable ar mining is it's lucrative enough to have attracted almost 1200 miners around the world to ensure our weave miners are adequately compensated for the foreseeable future only a portion of the ar paid to miners for their data storage services is accessible immediately the rest is put into a sort of on-chain treasury called the storage endowment which gradually releases ar coins over time to ensure our weave miners are always making enough to cover their costs the cost of permanent storage on r weave is calculated based on the assumption that the cost of data storage will decline over time the r weave protocol assumes that the cost of data storage will decline at a much slower rate than is currently projected in order to be on the safe side and it uses a 200-year timeline for its cost of storage calculation at the moment it costs around seven dollars of ar to store one gigabyte of data on our weave this is much more than both centralized and decentralized storage solutions but this is because you're paying for permanent data storage and it's a one-time payment if all that wasn't awesome enough r-weave is smart contract compatible the front-ends for r-weaved apps can be made decentralized and permanent all the data and apps stored on r-weave can be accessed via google search and its block weave can process around 5 000 transactions per second this barely scratches the surface of how our weave works and i strongly suggest checking out my first video about the project when you're done watching this one that will be down in the description now it's been over half a year since i last covered our weave and to say that a lot has happened since then would be an understatement in september last year decentralized streaming protocol livepierre released a tool called the web3 index which tracks the use of cryptocurrency protocols that underpin the decentralized internet as you can see our weave is at the top of the list by a wide margin and it has apparently held this position since the web 3 index was introduced i'll leave a link to it in the description if you're interested in early october crypto indexing protocol the graph integrated with rwev making it easy for crypto devs to analyze and incorporate all the data stored on its block weave a highly anticipated decentralized blogging platform on ethereum called mirror also went live with arweav as its decentralized storage solution at the end of october a data archiving protocol on our weave called kive network raised almost three million dollars from well-known crypto vcs for context kive network is how most cryptocurrencies have integrated rwev including avalanche silica polka dots parachain moon river near protocol and injective protocol in november are we've integrated with ethereum's leading scaling solution polygon via bundler network another data archiving protocol built on our weave it appears that most of the data storage on r weave is actually occurring via bundler and that might have something to do with the fact that you can pay for this data storage using any token and bundler will automatically convert it to ar to pay our weave miners behind the scenes in december expert investor katie hound left her post as partner of the crypto vc firm andreessen horowitz to create her own crypto vc firm now this is significant because katie reportedly led the deal to back arweev as well as other promising crypto projects such as the open sea nft marketplace as it so happens katie just raised 1.5 billion dollars for her crypto vc firm called hound ventures and i have a feeling that some of that capital will find its way into our weaves ecosystem if you're curious about the largest vc firms in crypto you can check out my video about them using the link in the description anyways in early january a crypto project called sarcophagus raised almost 5.5 million dollars from various crypto vc's including the r weave team sarcophagus calls itself a quote decentralized dead man switch built on ethereum and arweav and it's designed to send all of your crypto to a wallet of your choosing when you die creepy but cool in mid-january an associate at boston consulting group wrote a lengthy thread on twitter about why are weave is so important now boston consulting group is one of the largest consulting firms in the world so the fact that our weave is on its radar is a pretty big deal at the end of january greyscale revealed that it is considering creating new crypto funds for over two dozen cryptocurrencies including rwev now unfortunately an arweav trust has yet to materialize but it's only been a couple of months since the announcement and i reckon it's only a matter of time before we see one in february our weave made the headlines in both mainstream and crypto media and that's because it had called on its community to archive as much information as possible about russia's invasion of ukraine arweave co-founder sam williams was even interviewed by bloomberg and he explained that the r-weave community had created bots to archive any data on the web related to the conflict and that these bots are archiving millions of photos articles and videos every day earlier this month a decentralized nft music marketplace built on our weave called pianti raised 6.5 million dollars from prominent people in the crypto industry including one of the co-founders of the sandbox a few days later arweav's decentralized alternative to google drive called ar drive raised 17 million dollars from various crypto vcs and the company said it plans on using those funds to create a decentralized gateway for arweav's entire ecosystem called ar dot io ar dot io is still in development but i'll leave a link to the website in the description if you're interested last but certainly not least our we've announced that it had integrated with ethereum's arbitram via bundler network making it possible for users of ethereum's second largest scaling solution to store their on-chain data forever if you want to learn more about ethereum scaling solutions you can check out my video about those using the link in the description anyhow as amazing as rweav's announcements updates developments and integrations have been ar's price is basically where it was when i last covered the project this is for a few reasons for starters ar's price action is highly correlated with souls solana's native cryptocurrency if you compare the price action of the two it's easy to see the parallels now this is because arweave has been storing solana's transaction history since december 2020 and it looks like most of the demand for our weave storage has been coming from solana specifically solana's nft marketplaces and the interest there has been on the decline for quite some time another reason why ar has been underperforming is because of china's crypto crackdown last autumn according to the r weave explorer there were once over 1 000 are weave miners in china all these miners have since gone offline at least according to the explorer during his presentation at the masari main net conference last september sam williams was asked why there were so many are weave miners in china sam said it's mainly because of another crypto project called chia which also involves using storage for mining many chia miners switched over to our weave when chia mining became less lucrative although china's latest crypto crackdown was well underway when sam made those comments it wasn't until late november that chinese authorities turned their focus to altcoin related operations and ar's price started to crash as chinese are weave miners dumped their earnings ar continued to crater in december along with the rest of the crypto market and has had a hard time recovering compared with many major altcoins i attribute this to ar's limited exchange support in the united states and there's no shortage of comments in the are we've subreddit expressing frustration about buying ar in the country i'll leave a link in the description to some of the best exchanges that list ar in case you were looking now the good news is that ar hasn't seen much of an increase on the supply side coingecko's historical data suggests that ar supply has only increased by about 6 million whereas coin market caps historical data suggests ar supply hasn't increased at all assuming an average price of 40 dollars per ar this works out to around 240 million dollars of cell pressure most of which was likely offset by the demand for permanent storage from crypto projects like solana all the bots automatically uploading data and all the regular people using rwev what's annoying is that rweav's vesting schedule is unclear and this makes it difficult to estimate how much ar's circulating supply has changed over the last few months and what it will look like going forward luckily the demand for r-weave is easy to estimate using its explorer and all its available metrics suggest r weave's adoption is still in an exponential trend regardless of its price to put things into perspective when i covered are weave last august there were just 151 miners and as i mentioned earlier there are now nearly twelve hundred on the user side are we've went from ninety thousand wallets to over a hundred and fifty five thousand wallets and the amount of data stored by arweav has jumped from ten terabytes to over fifty five terabytes as a cherry on top are weave's monthly transaction growth has been explosive over the last year and is showing no signs of slowing down best of all are weave has a medium-sized market cap and that means it has lots of room to grow with enough integrations and decentralized applications driving demand ar could easily 5x from here in the long term whether or not ar can crank out this parabolic run ultimately depends on arweav's upcoming milestones our weave doesn't seem to have an official roadmap but a few upcoming milestones can be found in interviews with and presentations by sam williams in a september interview sam said that polkadot is among the cryptocurrencies that will be using arweave to store their transaction histories this makes sense given that polkadots developers have turned their focus to total decentralization over the last year or so as far as i can tell arweave has been working on its polka dot integration for over a year and still seems to be working on it to this day and speaking of decentralization sam also said that arweave is focused on removing the remaining centralized elements of its ecosystem this includes the are weave website itself which will eventually be moved to the ahrweav wiki that lives on arweav's permaweb sam even hinted that arweav is looking to offer archival services to institutions including governments which would obviously lead to lots of demand for ar in his aforementioned presentation at the mainnet massari conference sam stated that arweav's short-term endgame is to become the backbone of all decentralized applications in cryptocurrency in sam's aforementioned interview with bloomberg the interviewer implied that arweave had just undergone another raise from crypto vcs and sam didn't deny it but didn't really give any details either the interviewer probably just mixed up our weave and our drive but i guess we'll see soon enough what sam did detail however is are we focus on incubating up and coming projects building on our weave via the open web foundry with a focus on creating use cases that will result in more adoption the r weave website highlights the four areas the open web foundry is interested in and these are the creation of bots that archive real world data decentralized storage solutions for institutions decentralized applications and initiatives to store culturally and historically significant information in an interview earlier this month sam specified that the open web foundry is looking to incubate no fewer than 1 000 r weave projects in the coming months and years this begs the question of how much of that money is coming from sales of ar but i'll come back to that in a moment first i want to draw your attention to a potential milestone that could send ar to the moon and that's the possibility that rweav will be selected to store ethereum's transaction history in a december article on our weave news which doubles as the project's blog the author analyzed the ethereum roadmap shared by vitalik buterin around that time and spotted something extremely important after ethereum transitions from proof of work to proof of stake adds shards and introduces zero knowledge based scaling solutions ethereum will essentially delete all transactions older than one year as part of a process known as the purge the rationale for the purge is that deleting all this historical data will make ethereum faster and more decentralized but as the author of the article points out it's important to store ethereum's full transaction history somewhere ethereum improvement proposal 4444 pertains to the purge and the authors of the eip ponder the possibility of storing ethereum's full transaction history on decentralized storage solutions like the interplanetary file system or ipfs the problem there is that the ipfs doesn't promise permanence in the same way our weave does and it doesn't have adequate financial incentives for storage either it also wouldn't hurt to store ethereum's full transaction history on more than one decentralized storage solution as such it's quite possible that ethereum will tap r-weave to store its full transaction history when the purge comes around and that will almost certainly create insane demand for ar i'll also quickly note that sam williams actually participated in the ethereum ico using btc he had mined so there's a chance he has the connections required to make this happen now if you're wondering what ethereum has been up to lately you can get the updates by checking out my latest video about the project using the link in of all places the description and now for everyone's favorite part my concerns about arweave my first concern relates to our weaves adoption there's no question that arweave's list of crypto project integrations is growing by the day but according to rweav's app explorer it doesn't see many interactions from regular people moreover arweave's two most popular browser extension wallets only have 30 000 combined downloads it's not bad given the size of the project but it's not great either this ties into my second concern and that's the effect archival bots seem to be having on our weave now a member of the coin bureau team actually uses arweav on a regular basis to archive certain news headlines and he's noticed a significant increase in the time it takes to upload data over the last month recall that archival bots have been out in full force since russia's invasion of ukraine now to be clear this is a very good thing but i fear that eventually there will be so many bots that it will make our weave unusable for regular people potentially even the crypto projects it's integrated with this will likely happen regardless of whether there's an international crisis going on this relates to my third concern and that's regulations those of you who watched my first video about the project will recall that r-weave has a peculiar content moderation policy the short of it is that our weave miners are not obligated to store any data they don't like for whatever reason sam williams was recently asked about how are weave can be compliant with data laws in certain jurisdictions like the european union and he seemed to imply that our weave miners could delete user data if requested to do so to be honest sam's answer wasn't really clear here and i suspect that might also have to do with regulations the last thing sam wants is for are weave to end up on the naughty list of governments around the world especially if the project is gunning to store their publicly available data i also couldn't help but notice that our weave has been aggressive in its decentralization efforts since i last covered the project and i again suspect this has to do with regulations this time regulations related to listing on cryptocurrency exchanges in the united states now with all that said though these concerns aren't really all that concerning the only thing that really irks me is the absence of information relating to stuff like mining rewards ar's vesting schedule and how the team's ar holdings are being spent this can and probably will be addressed in due course especially since the arweav community is asking a lot about it as well what's important is that arweave has seen some serious adoption and is in the perfect position to establish itself as one of the top crypto projects on the market i truly believe that rwev will eventually become the backbone to not just all decentralized applications but all major cryptocurrency blockchains and when that happens mark my words ar will moon that's all for today's are we've update if you're looking for exchanges which list the ar coin which i rate then i have a juicy ok x fee rebate which you'll want to grab before it's too late visit that link in the description if you just can't wait if you have something to say drop a comment below before you get on your way if you enjoyed the video turn that like button grey remember to subscribe to the channel and ping that notification bell too because the worst thing to be in crypto is late if you're looking for more from the coin bureau i know just the place coin bureau clips for behind the scenes and live streams the coin bureau podcast which is perfect to listen to when you're doing other tasks my twitter tik tok and instagram for the good kind of crypto spam and detailed daily crypto updates in the coin bureau telegram did you know that subscribing to my weekly newsletter isn't just for super fans it's where i reveal the rest of my portfolio and tell you all about my crypto plans you can find my second channel podcast socials telegram newsletter and deals page down in the description that's all from me i really must fly so it's time for this guy to bid you goodbye [Music]