Should You (or Anyone) Buy The Graph (GRT)?

How much do you know about the Google of blockchains?

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Key points

• The Graph is an indexing protocol that some have called the Google of blockchains.
• The Graph has a strong leadership team and integrates with several blockchains.
• Cryptocurrencies are risky investments and we don’t know how long the current risk-averse climate will continue.

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The Graph (GRT) has been dubbed by some as the Google of blockchains because it’s all about making it easy to organize and access data. It’s an indexing protocol that works with several different blockchains. It uses something called “subgraphs” to create datasets that can be shared across applications.

If we continue the Google analogy, one is the search engine of the current iteration of the internet, but The Graph will be the search engine for Web 3 — the next generation of the internet.

Coin basics

GRT has been in the top 100 cryptos by market capitalization since it was first released. One advantage of The Graph for investors is that they can stake their tokens and earn rewards.

• What it does: GRT is the utility and governance token for The Graph’s indexing protocol.
• Management team: The Graph has a decentralized ecosystem, but two groups — The Graph Council and The Graph Foundation — support its activities. Eva Beylin is director of The Graph Foundation and has a solid grounding in crypto and management.
• Date launched: The Graph was founded in 2018 and launched GRT in December 2020.
• Market cap: $1.2 billion (CoinMarketCap, May 16, 2022)
• Availability: Most major U.S. cryptocurrency exchanges

Should you buy it?

Like many cryptocurrencies, The Graph has had a tough six months. Even so, it’s appeared on our top daily gainers list a couple of times this year. There’s excitement around the upcoming Graph Day in June as well as a grant program to incentivize development.

Sadly, that hasn’t been enough to help it through the recent crypto-wide turbulence. The Graph is currently worth about 70% less than it was at the start of 2022 and is now at an all-time low. Some may see this as an opportunity to buy a solid crypto at a discount. Others may be concerned The Graph may fall further or not perform in the long term.

The uncertain economic climate and fears of a recession have made many investors wary of risky assets like crypto. We don’t know what will happen, but it’s wise to prepare for a possible period of prolonged low prices. That means one of the biggest risks for GRT investors is that it, along with many other cryptocurrencies, might not survive a crypto winter.

It’s also worth noting that The Graph isn’t the only operator in this space, though it has garnered a lot of attention. It’s worth comparing The Graph to competitors, such as Bitquery, to see how it stacks up.

That said, The Graph is a well-respected crypto which solves an important problem in the industry. It has a strong governance structure and you’ll find experienced figures from the crypto industry are involved with the project. It integrates with various blockchains, including Ethereum (ETH), Solana (SOL), Polkadot (DOT), and NEAR Protocol (NEAR).

Plus, a number of key crypto projects have subnets on The Graph’s ecosystem. These include Livepeer (LPT), Audius (AUDIO), Sushi (SUSHI), Curve (CRV), Decentraland (MANA), Uniswap (UNI), and more. Its grants program has already allocated almost $12 million to support development and evolution of the ecosystem. These incentives are becoming a popular way to encourage developers to use particular networks.

Bottom line

The Graph has a lot of potential, but there are no guarantees in crypto investing. Make sure you do your own research and think about how The Graph fits with the rest of your portfolio and your investment strategy. Most importantly, only invest money you can afford to lose in any high-risk asset like crypto. That way, if the project succeeds you will benefit, but if it fails it won’t be financially devastating.