Deep Dive into the Decentralized API Service API3

first level title

What is API3?

Before explaining API3, let's take a look at what API is. The following explanation comes from Wikipedia:

interfacecalculateinterfaceintermediarysoftwareintermediaryinteractinteracttransfertransfer(call) oraskThe type of (request), how to make a call or issue a request, the data format to be used, the conventions to be followed, etc. It can also provideextension mechanisminformation hidinginformation hiding, the API implementsmodular programming, allowing user implementations to use the interface independently.

In other words, the API can provide us with various services (applications, plug-ins, websites, APPs, etc.), of course, it can also provide asset price data to apply to financial transactions (this is why some people say it will is a ChainLink killer). For DAPPs, it is particularly important to be able to access the services provided by APIs to interact with the real world. However, these APIs are not inherently compatible with DAPPs.

hereherefirst level title

Gordion Knots and the Oracle Dilemma

API3 tells us an ancient legend, Alexander arrived in Gordion, where he met Midas, the late king of Phrygia, who greeted him with an ox cart tied to a post, and "told" him: If anyone unties the Tie this knot, and that person will become the ruler of Asia. Alexander heard the prophecy, tried unsuccessfully to untie the knot, and finally cut the knot in half with his sword, and made the prophecy a reality.

API3 applies this philosophy to oracle machines. They believe that the oracle machine technology in the blockchain world should remove middlemen, but in fact, most oracle machines are just replaced by other middlemen. Its predicament is manifested in:

• The API services available on the blockchain are provided by third-party oracle node operators, and these operators are hand-picked by the centralized management agency (meta-middleman);

• Current oracle implementations rely on third-party oracles operated by entities that do not own the data or services they provide. The solution of API3 is to cut off the Gordion knot and directly use the "first-party oracle machine", which is the oracle machine operated by the API provider.

Based on these dilemmas, API3 applies the philosophical revelation of Gordion knot to the oracle machine. API3 lists the differences between API3 and the current oracle machine in terms of solutions:

Existing aggregators of decentralized oracles are centrally managed and do not include source APIs within their scope of management

first level title

The operating logic of API3

The above diagram still does not specifically explain how API3 operates. The following figure briefly introduces the operation logic of API3:

There are four roles here:

• dAPPs: service users;

• Pledgers: Managers, guarantors, pledgers pledge API3 tokens to the pledge pool managed by API3, provide insurance money, and obtain the governance rights of API3 DAO and share of API subscription fees;

• API3 DAO: manage API source, manage pledge pool;

• API Provider: Provide API data for API3 DAO

Briefly explain its business process:

• Stakers pledge API3 tokens to the pledge pool, provide insurance money for the pledge pool, and obtain the governance rights of API3 DAO

• API3 DAO selects high-quality service providers from among many API providers to enter the aggregator

• dAPP subscribes to the dAPI service, pays the subscription fee, obtains data or services, and the pledger gets a share of the subscription fee

• If there is a problem with the API data (false or otherwise), the dAPP can obtain insurance claims from the mortgage pool, and the pledger pays the price

A few notable features:

• The API service provider directly acts as the oracle machine, which reduces the intermediary links to a certain extent and makes the data service more smooth and real-time

• The credibility of the API data is provided and guaranteed by the DAO composed of pledgers. Once a problem occurs, API users (dAPPs) can obtain compensation

• The role of the pledger becomes the object of power and responsibility, weighing the game of reward and responsibility

A few possible problems:

• DAO governance dilemma. DAO governance is not as simple as imagined in the process. Realistic issues such as the number of participants, voting rate, voting mechanism design, and voting quality (51% attack) will all be challenges for this model;

• Lack of constraints and punishment mechanisms for API providers;

• first level title

API3 DAO

In order to realize the decentralized governance of dAPI and the entire project, API3 is governed by DAO. The governance is completely decentralized and open, and all stakeholders can directly participate in the governance of the project. In addition, the legal entity governed by API3 DAO is a Cayman Islands foundation: API3 Foundation Limited Company.

The main mission of API3 DAO is:

• Vote for an API service provider

• Management agreement, including modification, upgrade, etc.

• Handle disputes and claims

• Manage some API3 tokens

API3 Token

The API3 token is not only the governance token of API3 DAO, but also the pledge token of the pledge pool.

API3 believes that decentralized governance needs to establish a balanced incentive mechanism, or that the entities it manages should be rewarded for good results and punished for bad results. The API3 Token achieves this in three main ways:

• Staking: Income generated by voting dAPI and inflation rewards

• Collateral: Supports insurance services that protect users from losses due to dAPI failures

• Governance: Governance Rights of API3 DAO

first level title

Lock up

Lock up

Token Lockup and Release Schedule

• Founder: 2-year lockup, 6-month release period

• Partners and Contributors: 2-year lockup, 6-month release period

• Seed round investors: locked for 2 years

• Early investors: locked for 2 years

• Public offering: no lock-up

• Ecological Fund: distributed by DAO

All tokens that need to be locked will be released block by block in a linear fashion.

This initial DAO will be inOfficial version of DAOComplete the migration to after the development is complete. With the release of the official version of The DAO, staking rewards will start and all token holders will be able to participate in governance.

first level title

project development funds

first level title

Operating costs of dAPI

API3 DAO will operate the dAPI and pay its operating costs, including gas fees and API provider compensation.

, which is based on

API3 will launch a public offering on Mesa DEX from November 30th to December 14th. The details are as follows:

• 30 November from 2pm (CET)

• December 14th at 2pm (or when the total quota is claimed) (CET)

• Held on Mesa DEX

• 20,000,000 API3 will be released, accounting for 20% of the total supply

• The initial price is $0.30 and the price cap is $2.00

• Proceeds and unsold tokens will go to API3 DAO

Mesa DEX

This token issuance will use DXdao'sMesa, which is based onGnosis protocol onDEX. API3 stated that the batch auction mechanism provided by the Gnosis protocol can achieve a fair token launch, because it limits the typical problems such as front-end operation and gas fees in the token issuance process of AMM-based DEX. In addition, API3 said that it will soon release a detailed tutorial on how to get API3 tokens on Mesa.

bonding curve

Related Links

Related Links

Twitter — https://twitter.com/API3DAO

Telegram — https://t.me/API3DAO (Community Chat)

Keybase — https://keybase.io/team/api3 (Developer Chat)

Github — https://github.com/api3dao

Reddit — https://www.reddit.com/r/API3/

Medium — https://medium.com/api3

DAOtalk — https://daotalk.org/c/daos/api3-dao/37