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Modern businesses depend on data to thrive. With the advent of artificial intelligence (AI), data dynamics have greatly improved and become more accurate to benefit society.
However, there’s still a significant imbalance in data distribution among businesses. You’ll find that social network giants like Google and Facebook are drowning in data, while AI startups have innovative AI models but lack access to enough data.
In short, the true power of harnessing AI through data remains in the hands of a few. Such data centralization has multiple disadvantages for society, such as increased data monopoly, biased AI algorithms and higher chances of data breaches.
However, Ocean Protocol has leveraged blockchain technology to create an innovative system design that will decentralize access and provide ways to monetize data through the use of data NFTs and datatokens. Let’s learn more.
Key Takeaways:
Ocean Protocol provides a platform to provide decentralized data services in an equitable way to power the web3 and AI data economy.
Ocean Market allows data providers to monetize their data and earn through a community-based data marketplace.
With integrations such as Compute-to-Data and data farming, Ocean Protocol preserves privacy while enabling users to reap more profits from data.
Ocean Protocol is a decentralized, open-source platform looking to equip society with the necessary tools and technology to create an equitable data economy in an increasingly AI-driven web3 era.
On a higher level, Ocean Protocol aims to use its technology to unlock more equitable data-sharing and monetization opportunities for users, especially in the age of AI, by preserving data sovereignty and increasing its value as a modern-day asset class.
The project is run by the Singapore-based Ocean Protocol foundation and consists of a global team of experts and advisors across the tech and business space. As an open-source project, Ocean Protocol is forkable, which enhances inclusivity, innovation and growth through AI on the part of data users and builders.
Ocean Protocol uses the concepts of blockchain technology and decentralized networks powered by smart contracts to facilitate secure data sharing, profitable data monetization and improved AI models. Its tools tap into NFTs to publish and own data, which can then be collaborated and traded through innovative data marketplaces.
The platform’s code runs on Ethereum and EVM-compatible chains, such as Polygon, Energy Web Chain and Moonriver. This allows developers to leverage the platform’s tools to create decentralized apps (DApps) for web3. Furthermore, Ocean Protocol uses ERC-20 tokens to monetize data in a secure and transparent way.
Its native token is OCEAN, which powers the platform’s data exchange functions and incentivizes community governance.
Ocean Protocol provides an on- and off-ramp structure for users to deploy data assets into cryptographic ecosystems. At the heart of the protocol’s operations are the use of datatokens, data NFTs and various access tools to power the process.
Data NFTs are non-fungible (but transferable) ERC-721 tokens, used to create a data service that gives you exclusive rights to publish and own a data asset. On the other hand, a datatoken is a fungible ERC-20 token that allows you to access data services on Ocean Protocol.
One simple way to conceptualize Ocean Protocol's architecture is to think of datatokens and data NFTs acting as interfaces for creating and consuming data assets. The datatokens and data NFTs interact within various applications in Ocean Protocol's architecture, such as Ocean Market, data wallets, data exchanges and more.
A more sophisticated overview of Ocean Protocol’s architecture reveals a three-tiered structure. The bottom layer consists of smart contracts that automate the creation and deployment of the datatokens and data NFTs. In the middle level are libraries that expose smart contracts to advanced languages, and various other tools for added convenience when discovering datasets. At the very top are the applications, including third-party apps, which act as an off-ramp for the consumption of the data assets.
So, how does it all work?
First, publishers need to register their data assets on Ocean Protocol. Let’s say you hold a dataset in your Google Drive or on your phone in the form of an URL. You’ll need to register it on the Ocean Protocol blockchain. Then, you can publish it by invoking the Ocean Protocol data NFT factory to deploy a smart contract for the creation of a data NFT against the asset. You can also invoke the smart contract and mint a datatoken against the data NFT to allow data service consumption. Then, run an Ocean Protocol Provider to store and encrypt your URL on-chain.
Meanwhile, consumers will need to send datatokens to the publisher's wallet and make a service request to the Provider. Through the Ocean Protocol network, the purchase request will be processed on-chain, where the encrypted URL will be loaded and decrypted, and the requested service availed to you. Ocean Protocol's data tokenization structure allows data owners to monetize their data, while securing their privacy using various access control tools.
While you can carry out this data access and exchange yourself via the Provider, Ocean Protocol has created the Ocean Market, which provides a more fine-tuned and decentralized process for exchanging data.
Ocean Market is an open-source data marketplace on Ocean Protocol. Think of it as a decentralized exchange (DEX) for data: it provides a community-based marketplace to connect data providers with data buyers.
Since it’s powered by blockchain technology, exchanging data via Ocean Market has various perks, such as using your web3 wallet to access the service. It’s also transparent and censorship-resistant, and helps you preserve your privacy.
As a data provider or owner, you can publish your data by listing it for sale on Ocean Market through a process called an Initial Data Offering (IDO). Buyers can then use their datatokens to pay for access to the data.
Most of the fees go directly to you (the seller), while the rest of the revenue is distributed among other marketplace participants, such as operators, liquidity providers (stakers) and the Ocean Protocol community.
To price the data, Ocean Market uses the automated market maker (AMM) concept operated by Balancer. Instead of sellers setting arbitrary prices, AMMs automate the price discovery process, in which a datatoken's price rises as more datatokens are bought and falls as more datatokens are sold.
Furthermore, the AMM-powered data markets give you yet another way to earn from data through staking. You can become a liquidity provider by locking your OCEAN tokens in an Ocean Protocol dataset. The process of adding or removing liquidity from the pool is known as data curating.
By becoming a curator, you’ll receive a fraction of the data swap fees corresponding to the amount you've staked. Hence, as a curator, you'll be incentivized to add liquidity to the most valuable datasets, and to refer other curators to the pools you've staked with to earn more fees..
Let’s look at some of the other features of Ocean Market that enhance its functionality.
Compute-to-Data (C2D) is an integration on Ocean Market that facilitates the trading of private data while preserving privacy. C2D helps balance the advantage of monetizing private data with the risk of compromising one’s privacy and control over it.
With C2D, specific algorithms ensure that during the data exchange, the datasets remain under the owner’s control. Not only does the C2D model benefit data owners through monetization, but it also securely provides AI practitioners valuable access to private data in order to generate more accurate AI models.
Ocean Protocol Data Farming (DF) is designed to spur the growth of Data Consume Volume (DCV) on the Ocean Protocol. It's similar to DeFi liquidity mining, but customized for data consumption. To earn data farming (DF) rewards, you need to lock your OCEAN tokens in order to receive veOCEAN tokens.
Rewards are only distributed in pools with DCV. The higher the DCV, the more rewards you earn. Moreover, the longer you hold your veOCEAN tokens, the higher your bonuses. You can hold veOCEAN tokens for up to four years.
You can earn DF rewards either passively (by default of holding veOCEAN tokens) or actively. For active DF, you can opt to actively curate data by allocating your veOCEAN tokens to pools with a higher DCV. You can also earn actively with DF by predicting the future price of Ethereum (ETH) on a weekly basis.
OCEAN is the native utility and governance token for Ocean Protocol. Its model works as follows:
Token value — OCEAN’s value is designed to increase as usage of Ocean Protocol tools increases, and also through a burning mechanism that reduces its supply.
Governance — OceanDAO oversees the growth of the Ocean Protocols ecosystem. It's composed of a treasury containing unminted OCEAN tokens, and is used to pay the OCEAN rewards due to Ocean Protocol workers who contribute to the protocol's growth. OCEAN holders can also vote for promising projects on the platform via the OceanDAO.
Incentives — OCEAN tokens are used to incentivize people to provide liquidity to Ocean Protocol dataset pools. You can also lock your OCEAN tokens to receive veOCEAN tokens in order to earn both passively and actively through data farming.
Unit of exchange — OCEAN is used to trade data on the Ocean marketplace. It’s the unit of exchange that powers the fixed price and auto pricing of data on the platform.
As of Aug 11, 2023, OCEAN’s price was $0.34, an 82.34% drop from its all-time high price of $1.93 on Apr 10, 2021, and an increase of over 2,500% from its all-time low of $0.013 on Aug 11, 2019.
Price forecasting experts are optimistic about the future price of OCEAN. According to analysts at PricePrediction, OCEAN may hit $0.98 in 2025 and rise to $5.96 in 2030, Another price prediction platform, DigitalCoinPrice, shares a similar opinion, forecasting a price of $1.25 in 2023 that could see $3.64 by 2030.
Can OCEAN hit $10 and $100? While many price forecasting experts believe OCEAN will reach $1 in the near future, the $10 and $100 marks are still far-fetched. According to CoinCodex, OCEAN could potentially reach $10 by 2036, but achieving $100 is highly improbable.
Please note that these price outlooks aren’t a guarantee of OCEAN’s future price. We highly recommend you do your own research before investing in OCEAN or any other cryptocurrency.
Recent demand for data has surged significantly, particularly in light of AI's growing prominence. Ocean Protocol is strategically positioned to provide a secure, private, transparent and decentralized platform for exchanging and earning from data. The availability of high-volume data through the protocol is attractive to AI researchers and data scientists, who thrive on data to improve the accuracy of their AI models.
Furthermore, Ocean Protocol’s Compute-to-Data integration allows companies to experiment with valuable data while preserving users' privacy. Ocean Protocol also opens up data users to more earning opportunities through data farming.
Based on the increased application of AI in various sectors and the need for preserving the privacy of data, Ocean Protocol is a good investment for the long-term investor.
You can buy OCEAN on Bybit as a USDT Perpetual (OCEANUSDT). First, sign up with Bybit to create an account and fund your account with USDT. To open a position, click on the Derivatives trading terminal on Bybit, and choose USDT Perpetual from the drop-down menu. Click on Trade to open an order. You can select your order preferences (Order by Qty denominates the order in OCEAN tokens, while Order by Value denominates it in USDT). In addition, you can adjust the margin mode of the position by increasing or decreasing it, depending on your risk appetite.
Ocean Protocol aims to provide users with the tools necessary to power a web3 data economy. By using datatokens and data NFTs, Ocean Protocol drives data monetization via secure and decentralized data marketplaces. As more sectors turn to AI models to power their activities, Ocean Protocol will remain a critical player in the crypto ecosystem’s data services niche.
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