Pocket Network — Research by Cryp2Gem
Deploy On Decentralised Infrastructure
Cryp2Gem is a community-based research group. We are constantly researching and searching for future blockchain disruptive innovators.
Our community is open for everybody, who are interested in learning and sharing knowledge about blockchain technology, cryptocurrencies and trading. Pocket Network report article is part of our research which is intended for the community. All the feedbacks and critiques are highly appreciated.
The author of this research is not invested in the project and tends to stay unbiased while researching and writing. This research is not intended as a promotion and is not part of any paid promotion. Cryp2Gem strongly believe in unbiased researching, sharing knowledge and transparency.
PROJECT: Pocket Network
WEB PAGE: pokt.network
WHITEPAPER: available here (all public documents can be found on their web page)
FIELD OF INTEREST: API PROTOCOL
SHORT DESCRIPTION: Pocket Network is a decentralized relay infrastructure designed to connect any app, to any blockchain, from any device.
CHAIN /TOKEN TYPE: Ethereum/ERC-20
MAINNET: live since July 2020
CONSENSUS MECHANISM: Proof-of-Stake (PoS) protocol using the Tendermint consensus
DEV ACTIVITY: Github
One of the most active development activity I have seen recently.
PRODUCTS: Mainnet live since July 28, 2020
EXISTING CUSTOMERS AND USERS:
Saturn Network, an uncensorable decentralized exchange (DEX) protocol, is using a Pocket Mainnet relay infrastructure since August. Pocket Network is also working with MetaMask and MyCrypto allowing users to enable decentralised Ethereum API requests through Pocket Gateway. Those are great examples of how easy it is to add a custom Pocket Network node and switch to Pocket to become your default decentralized Ethereum network provider. They have an agreement with ETHOnline and ETH Global to be an official default network provider for the hackathon. The Arcadia Group will implement Pocket as a core element within its exchange development stack.
COMPETITORS: All API providers and node infrastructure solutions could be considered as a direct blockchain-based competitor of Pocket Network — Infura, Alchemy, Etherscan, Ankr, CovalentHQ, The Graph, API3
*Luis De Leon, CTO, Software Developer and Entrepreneur, tech-lover and maker.
*Michael P O’Rourke, CEO, Self-taught iOS and Solidity developer. White paper reader and ICO investor.
*Pabel de Jesus Nunez Landestoy, COO, Web/iOS Developer
*Patrick Maguire, operations lead
Other team members: Andrew Nguyen — Protocol Lead, Pabel Nunez — Applications Solutions, Jeremy Beal — Developer Evangelism, Jack Laing — Governance Lead and Alberto Jauregui — Ecosystem Lead
INVESTORS: Skillz, MetaCartel Ventures, Saturn Network, Pocket Network Inc (PNI), Zee Prime, Eden, Blockwall Cap, and Borderless Cap
TOKEN ECONOMICS and METRICS BREAKDOWN
Pocket Network economics are a dependant of relays or API requests which are created by a developer for a certain DApp. Each time the relays are validated by nodes, a new block is confirmed and POKT is minted and issued to the nodes providing the service. Pocket Network has a dynamic issuance rate based on its usage where the circulating supply is what is minted by the nodes. There will be a dilution of the supply by staking tokens to provide service which will trigger incurring inflation.
Both DApps requesting relays and Service Nodes must stake POKT to access or provide work to Pocket Network. Nodes have to stake the minimum 15k POKT ($1,2k at a $0,08 POKT price) to serve an application in a relay request session and earn POKT fee for their work and DApps have to stake a minimum of 1 POKT for 21 days.
The supply of POKT token depends completely on the demand for new API requests and sessions serviced by the nodes.
Based on the info from their block explorer there are currently 65 Apps, 128 nodes and totally 345 million POKT token staked. As 0,01 POKT per validated relay is minted and there were 6,5 million relays served in early September, that would make a 65k POKT tokens minted. 10% of that supply goes to PocketDAO and 1% goes to the block producer that verifies the TXs. 89% goes to the nodes that service apps requests/relays. Amongst current node operators are Figment, Rivet, Chainflow, Tuku dev, Skillz, Everstake, Simply VC, Stakin, Pocket Network Inc, and all the rest individual node runners.
Pocket Network Inc (PNI), the company who created Pocket Network, can sell directly to application developers and node operators. They can sell up to 50 million tokens. PNI has created the DAO to govern the protocol and the Foundation which enables interaction with entities that the DAO can’t interact with (such as legal entities for example).
FULLY DILUTED MARKET CAP: $52 million (considering $0,08 price)
INITIAL MARKET CAP: 50 million POKT
TOTAL TOKEN SUPPLY: the amount of POKT will grow over time until the DAO caps the inflation upon maturity
INITIAL SUPPLY [%]: 650 million POKT
You can see some of the latest metrics and supply information here.
FUNDS RAISING INFO (allocations & vesting):
Pre-seed 75,4 million tokens were sold for $754k ($0,01 POKT price)
Seed 33,2 million tokens were sold for $1,3 million ($0,04 POKT price)
Pre-seed and seed investors have a 1-year lockup from the date of their purchase. Extra lockup for already expired agreements:
*Mainnet + 6 months: 50% unlock
*Mainnet + 12 months: 100% unlock
(Mainnet has launched on 28th July 2020)
Two sales for 57,9 million tokens:
*7,9 million tokens were sold for $474k ($0,06 POKT price)
*50 million tokens are being sold for $4 million ($0,08 POKT price).
Tokens are locked and staked for 21 days.
*Token sales 8,9%
Founders, Employees, Contractors and Advisors have vested tokens which will be locked up for 12 months from May 15, 2020, and released on May 15 2021. 10% of the total POKT allocated to founders will immediately vest upon mainnet with the same lockup as already mentioned. Founders, Employees and Contractors can score additional 18.33% bonus in POKT on their annual compensation when Pocket Network reaches a decentralization milestone. Bonus POKT is distributed when 100 nodes are operating, and the first DAO resolution has passed.
*Employee pool 2,7% with 105 days lock
*DAO 7,7% with 4 years vesting since mainnet
*Incentivised Testnet 3,8% with 105 days lock
*PNI Reserves 8,9% with 4 years vesting since mainnet
*Foundation Reserves 8,9% with 4 years vesting since mainnet
*MVP 0,2% with 105 days lock
Pocket Network is a blockchain agnostic network (single platform allowing interoperability). Meaning that any decentralised peer-to-peer application (DApp) can be connected to any supported blockchain network. Currently supported networks include Ethereum Mainnet (full-node), Ethereum Mainnet (archival), Ethereum Testnets (all of them) and xDAI. List of supported networks can be found here.
Pocket is providing a simple to use, cost-effective layered relayer infrastructure. The protocol is comprised of App, Nodes and Network layers. The data/API request is sent from a DApp to the targeted blockchain with the assistance of the nodes. The network layer provides the protocol rules, governance, record tracking, and economics for nodes and applications.
Pocket is a permissionless and decentralised marketplace for developers who need to collect data from a specific blockchain and transfer it to their DApp. An alternative to existing API solutions. The queries and transactions are enabled with the decentralized relay infrastructure of node operators and infrastructure providers. The SDK will allow easy node deployment as well as simple entry and use for developers. The cost reduction will be very attractive and effective as it will supposedly be even up to 10x more cost-effective than the costs of existing centralised solutions. So Pocket will be saving developers time and money.
The protocol has a very healthy and interesting token economics model where the demand powers the rewards and determines the circulating supply of POKT tokens. The demand for relays requires service of the nodes which triggers inflation. Staking is a basic requirement for both service access requested and work providers to be selected.
Since the launch of the Mainnet in the 28th July 2020, the is very fast growth in demand and issuance of API requests. In August Ethereum based DApps have requested almost 2,8 million relays. In the first week of September, there was already 6,5 million relays served and validated. That makes 1 million requests per day currently. They have almost tripled the number of relay sessions in just one week. This means that there could be 100 million requests per day by the end of the year.
Developers pay quite a lot to different centralised API providers and infrastructures like Infura and Alchemy and AWS to use their services. Pocket has a unified and multi-chain API solution which might save quite some time and money.
“What matters is who provides the best service and the cheapest service, which is what we aim to do,” said Jack Laing.
Time will tell.
Cryp2Gem team is always available for any further discussions in our social media. Looking forward to all the feedback.