Band Protocol (BAND)

From CryptoWiki

A solution that incentivizes the creation and flow of valuable information through decentralized oracles.

Band Protocol
Total supply100.000.000 BAND
Websitehttps://bandprotocol.com/

Basics

  • Based in: Thailand
  • Started in: 2017
  • Had their mainnet launch on 30-9-2019. "Recently (25-7-2020), it was announced that Band Protocol is now ready to proceed towards the mainnet upgrade to Phase 1 which will bring oracle functionality to the BandChain Mainnet."
  • From CMC (11-2019):

"Band Protocol offers a decentralized data oracle by making data readily available to be queried on-chain, using delegated proof of stake ("dPoS") to ensure data integrity. It aims to be the go-to data infrastructure layer for Web 3.0 applications by providing decentralized, curated off-chain data to smart contracts through oracles managed by its dPoS consensus mechanism."

History

Band Protocol has mentioned that they will eventually migrate to BandChain (10-2019).

Audits & Exploits

Bugs/Exploits

Governance

Admin Keys

DAO

Treasury

Token

Binance Lanchpad Sale

  • The project has raised ~$10.5 MM via private token sales and the Binance Launchpad Sale.

"This past September, Band Protocol was announced as one of the premier projects to undergo a Binance Launchpad sale, raising $5.85M in exchange for roughly 12% of the total supply. At the time of sale, the base rate for BAND was set at $0.473, signaling a diluted market cap of around $50M.

Shortly after the fundraise, Band Protocol went live on Ethereum main-net, meaning that the system is up and running today. BAND is currently listed on Binance, Bilaxy, and Dcoin with the dataset for Financial Data Token operational here.

According to Etherscan, only 344 unique addresses currently hold BAND with the majority of the tokens still being held in the Band multi-sig wallet. While this seems rather small, the amount of individual holders is well above the listed addresses. During the Binance Launchpad sale, a total of 16,321 out of 35,579 participants won the lottery draw while the rest of the 19,258 participants received tokens from the 631,800 BAND airdrop (~32.80 per participant)."

Token allocation

  1. "Seed Sale Investors comprise 10.00% of the total token supply.
  2. Private Sale Investors comprise 5.00% of the total token supply.
  3. Public Sale Investors comprise 12.37% of the total token supply.
  4. Ecosystem comprises 25.63% of the total token supply.
  5. Team comprises 20% of the total token supply.
  6. Advisors comprise 5.00% of the total token supply.
  7. Foundation comprises 22.00% of the total token supply."

Utility

Token Details

  • From Binance Research (6-9-2019)

"The Band ecosystem consists of two token types: BAND token and dataset tokens:

  1. BAND token is the native token of Band Protocol. With a fixed supply, BAND tokens are used as collateral to issue dataset tokens, stake to participate in BandChain consensus algorithm, and on-chain governance.
  2. Dataset token represents the ownership stake in a particular dataset inside of Band Protocol, and is used as stake to acquire data provider slots, data provider curation, as well as to vote for dataset configurations.

All fees and rewards are paid using BAND tokens.

Band Protocol utilizes a multi-token model where each dataset is controlled by its dedicated Dataset token. Dataset tokens are issued by collaterizing BAND tokens with a bonding curve. Once created, Dataset tokens are used in the ecosystem to curate and govern oracle data."

"Band uses a dual-token economy to segment and incentivize unique data sets. This approach ensures that providers of any given set are compensated properly in the event that their information becomes more valuable than others. The token economy can be broken down into two unique assets: dataset tokens and the native BAND protocol token.

Dataset Tokens

Datasets are split into multiple Dataset Governance Groups, each of which utilize a unique token to stake, curate and govern information through mechanics like a Token-Curated Registry or Token-Curated DataSource.

Without diving too deep, Token-Curated Registries (better known at TCRs) allow for different addresses to be whitelisted to participate in the respective ecosystem. In the context of Band, this means that a given address can be verified as being trustworthy or marked as having the ability to vote on any governance issues that arise (such as a dispute in the finality of a specific data point). 

In short, dataset token holders can become a "data provider" who is responsible for curating high-quality data that is fed to smart contracts, purchase data from a dataset or vote for data providers they trust to contribute valuable (and valid) information.

Why Curate or Participate?

Every time data is sold to a smart contract, rewards are distributed to providers pro-rata, with subsequent voters receiving a fraction of the reward. In short, data providers stand to earn an income by contributing valuable data whereas participants stand to earn from voting for that provider. Furthermore, competition from multiple datasets in similar verticals further drives the quality and demand for any given dataset.  

While the data governance tokens are unique, they are all secured by Band’s native protocol token, BAND, through a bonding curve.

BAND Token

BAND provides liquidity to data governance groups by serving as a primary value capturing mechanism in a few different ways. First and foremost, BAND is used as collateral to issue dataset tokens. As such, BAND token value is directly correlated to the value of the protocol’s datasets.

As with many other strong token economies, BAND will be used to govern future protocol upgrades. In short, community members must acquire BAND to signal their opinion on changes to the protocol as a whole.

Next, BAND is used to control dataset quality through a curated dataset registry. Similar to how an address can be whitelisted on a given dataset, Band Protocol maintains an active list of all verified datasets. In order for a dataset to join the registry, they must stake BAND as a proxy.

Lastly, Band Protocol has mentioned that they will eventually migrate to BandChain, in which BAND will be used as a staking mechanism to secure the network via a Delegated Proof of Stake (DPos) consensus mechanism. Similarly, BAND will be used as the underlying currency for all that transactions that happen on the network.

Protocol Dynamics

Band Protocol relies on query fees to cover the cost of data providers and incentivize honest data curation. Whenever a smart contract issues a data query function call, it must attach a fee denoted in a blockchain’s native currency (ETH in the case of Ethereum). Query fees are split among providers and stakers based on a fee schedule determined by a group’s Governance Parameters.

Band Protocol utilizes Uniswap to instantly convert the accepted currency (ETH) to BAND, which then gets converted to the dataset token through a purchase on the bonding curve.

By doing this, regardless of what currency a dApp pays in, data providers and token stakers still receive revenue in their unique dataset token. Taking this a step further, this means that as the system acquires more query fees, more BAND will be locked in dataset bonding curves."

Stablecoin

Coin Distribution

Tech

  • Whitepaper can be found here (1-5-2019).
  • Code can be viewed here (12-6-2020).
  • Built on: Band Protocol initially launched on the Ethereum blockchain in September 2019 with support from Sequoia Capital. But 2.0 was launched on Cosmos.
  • Supports 20 chains (31-1-2023).
  • Programming language used:

Transaction Details

  • Capacity (TPS): 50
  • Latency: Says (8-2020) oracle requests are handled within 3-6 seconds.

How it works

"The Band Protocol is a decentralized data oracle for Web 3.0 applications. The Protocol connects smart contracts with trusted off-chain information through community-curated data providers. So, what does that mean? Most existing smart contract platforms, even though they support the trustless execution of random programs, still lack access to real-world data. In the Band Protocols’ vision, this makes smart contracts less useful. Therefore, with the use of BandChain (Decentralized Oracle Network), they connect public blockchains to off-chain information. The Band Protocol has the following design goals:

  1. Speed and Scalability
  2. Cross-Chain Compatibility
  3. Data Flexibility"

"Bandchain, the blockchain developed by Band Protocol to power their oracle network, will initially launch with 17 genesis validators while onboarding exchanges and other partners. The network will eventually grow to more than 50 public validators and allow delegated staking to help secure the network."

"BandChain nodes are required to operate as both the validators of the blockchain (producing blocks, validating and ordering transactions) and as the oracles that service external data requests. The top 100 validator candidates with the most tokens staked to them become the validators of BandChain. The network’s annual inflation rate will begin at 13.5%, targeting a staking ratio of 66% of the total supply. If the staking ratio is below 66%, inflation will rise to a maximum of 20%. If the staking ratio is higher than 66%, inflation will decrease towards a minimum of 7%. Additionally two percent of each block reward is diverted to a community fund pool."

Fees

Upgrades

"We first upgraded the Band Standard Dataset as this is a prerequisite to creating a strong foundation and future scalability that we plan for 2023. This upgraded version works as a standardized plug-and-play solution whereby Cosmos-ecosystem chains/smart contract applications and EVM-compatible chains looking for price feeds of tickers/symbols that passes the Band Standard, will be able to interact with the BandChain to get price feed data in a self-service manner. This also expedites the lead time for accessing price feeds of multiple available asset classes.

Band VRF v.1 is now available on Ethereum, BNB chain, Polygon, Optimism, Cronos, Oasis, Avalanche, OKC Chain, Godwoken testnets and many more. Current on-going improvements target increasing efficiency (cost) and performance (time to resolve) of the Band VRF v.1 in order to expand utility such that it is applicable to a wider range of Gaming use cases.

[Also upgraded to V2.4]

  1. Increase throughput by 10X- Increased BandChain block gas limit by 6.25X to 50M gas per block- Accurately and efficiently calculate gas, which led to a reduced consumption
  2. Cosmos IBC compatible- CosmWasm contracts from other chains can request prices from BandChain directly through IBC- Supports the InterChain account standard, therefore allowing users to send transactions from other networks via IBC"
  • From their blog (15-10-2020):

"Band Protocol has successfully upgraded BandChain from Wenchang to GuanYu, completing Phase 1 which supports the permissionless creation of customizable data oracle scripts that can query public and permissionless data sources leveraging a decentralized network of 67+ validator nodes."

Staking

Validators

  • Claims to have 50+ participating validators on its GuanYu testnet (1-8-2020).
  • From their blog (1-8-2020):

"Specialized multi-asset investment fund focused on high growth distributed ledger technology (DLT) and blockchain project, Woodstock, is joining as a validator node on BandChain."

Among its validators are (8-2020): Forbole, HashQuark, stake-fish, StakeWith.Us, WeStaking, IntlStones, Chorus, Node a Team, B-Harvest, UBIK Capital, Woodstock and Figment Networks.

Different Implementations

Interoperability 

"Band Protocol will be facilitating a bridge for all participating blockchains on Gravity between all types of data, ranging from on-chain events used in cross-chain operations such as token transfer to external data sources or APIs that power specific decentralized applications. Gravity’s nodes will be able to obtain oracle data from the BandChain decentralized oracle network and relay them to any other blockchain or decentralized application connected to Gravity. For any specific piece of data available on BandChain, it will be possible to prove, from another blockchain, that an oracle query result or specific transaction has taken place on BandChain."

"Band Protocol aims to be blockchain agnostic, where oracle requests are processed in BandChain’s environment and bridged on to other chains. They plan to leverage the unreleased Inter Blockchain Communication (IBC) protocol being developed by Cosmos to bridge data to other chains, although it’s unclear if and when IBC will be production-ready. Because of this, users are required to use a lite client protocol to manually bridge data to other blockchains until IBC has launched. This requires users to rely on external third parties outside of the BandChain protocol to actually deliver the data to the consuming smart contract on another blockchain (e.g. a DeFi application on Ethereum). These third parties have no incentive to deliver the data reliably or any punishment for not doing so."

Other Details

Oracle Method

Their Other Projects

BitSwing

  • Also launched a decentralized trading app, BitSwing, in October 2019.

Open Oracle Gateway

"Acala is launching a new oracle service for the Polkadot ecosystem. The Open Oracle Gateway will provide data for Acala, Karura, Kusama, and various other platforms running on Polkadot. The Gateway is the result of a collaboration between Acala, Laminar, and Band Protocol."

Verifiable Random Function (VRF)

  • Has launched a similar function as Chainlink (30-9-2022).

Roadmap

  1. "Security: As security is paramount to us, this will always remain the number one top-of-mind priority. We have planned multiple on-going efforts to ensure the smooth running of our products
  2. Interoperability: In 2022, IBC has really paved the way and enabled Band Protocol to increase interoperability between different blockchain networks. This year, we have plans to roll out three new products that will take this to another level
  3. Scalability: Even after the recent BandChain upgrade, Band Protocol will continue to improve and introduce more scalability solutions to enable our oracle network to handle a larger volume of data requests
  4. Decentralization: Band Protocol is committed to increase the decentralization of our network by working with our community and onboarding more validators and oracle node operators
  5. Adoption: There are several ways in which we plan to increase the adoption of our platform. One of which is to explore collaboration with companies in a variety of industries across multiple products. Others include increasing utility and therefore the intrinsic value of the protocol’s network"
  • Is saying it will be moving to Phase 2 (25-8-2021).
  • Can be found here (1-2020). Update (3-2-2021).
  • From their blog (15-10-2020):

"The next upgrade to BandChain Phase 2 will expand built-in support for permissioned and paywall APIs from premium data providers as well as improving the composability between multiple oracle scripts.

We are already working with various premium data and API providers who will be able to collect fees automatically on-chain per call from decentralized applications.

The exciting facet of Phase 2 is that smart contracts and DApp developers will be able to reliably connect to most of the data available on the open internet in a trustless manner. This will strongly expand the data availability and use-cases accessible through blockchain technology."

"BandChain, will launch in three successive stages including the on-boarding of community, professional and ecosystem partners as validators, the release states."

Usage

  • From their blog (31-12-2020):

"In December, the total amount of data requests on BandChain, surpassing 450,000 requests and growing by an astounding 450% in one month."

Integrations

  • DSLA Protocol has it integrated (24-8-2020); "a decentralized finance alternative to Service Level Agreements (SLA), has chosen Band Protocol to power DSLA smart contracts and created custom decentralized oracle to bridge staking analytics from the DSLA decentralized performance monitoring data indexer. Band Protocol will also be joining the DSLA Incentivized Beta which will provide BAND delegators a decentralized hedge against validator performance while enabling anyone to earn rewards for protecting BAND staking deposits against staking risks."
  • Eden Network; "We are proud to share that one of the Tenant Slots at Genesis upon Eden Network’s launch has been secured by Band Protocol to deliver an even higher degree of price security and reliability in our oracle solution that is used to secure billions of dollars in value with frontrunning resistance." (3-8-2021).
  • Elrond; from the announcement (22-1-2021): "has completed the integration of the Band Standard Dataset on the public devnet for all DeFi developers to readily-integrate. Both teams outlined an integration roadmap in 2020 which is on track to fulfilling the end goal of integrating a permissionless and end-to-end customizable oracle design for developers on Elrond Network"
  • Etherisc; is using it (22-9-2020) for its Flight insurance (together with Provable and Chainlink)
  • Fantom; Band Protocol and Fantom collaborate (19-3-2020) on bringing oracles to Opera Mainnet. Update: has now been integrated (18-9-2020).

"We are thrilled to announce our partnership with @Ripple backed @Kava_Labs $KAVA to integrate $BAND into their cross-chain #DeFi platform."

Competition

Vs. Chainlink

"In comparison to an oracle project like ChainLink, Band’s functional product provides a strong foundation for us to make logical assumptions about the token’s future. As it currently stands today, the LINK token economy is theoretical.

Band faces an uphill battle due to the brand that ChainLink has developed in the past year. With ChainLink announcing support from Google, it’s clear that the decentralized oracle market is shaping up to be an extremely competitive one to say the least. Beyond ChainLink, there are a number of other decentralized oracle providers, all with a similar mission to drive value through the curation of high-quality data."

Pros and Cons

Pros

  • From Hackernoon (16-1-2021):
  1. "Speed and efficiency
  2. Compatibility with many blockchains
  3. Permissionless oracle creation
  4. Simple, smart contract integration"

Cons

  1. "At launch, BandChain will only initially support free, low-quality APIs, whereas paid, password-protected API support is still largely theoretical. Thus, developers cannot just call any password-protected API they desire. Their proposed plan is to require data providers to change their entire business model to accept on-chain cryptocurrency payments for data.
  2. Built randomness as a core component of the protocol; it’s the required method for choosing oracle nodes, despite the feature not being supported by any original academic research. Not only does it severely limit data accessibility (every node must have access to the same data) and network security (must trust every node), but the team is largely incompetent on the subject, as they were caught trying to copy Chainlink VRF on their Github repo.
  3. Their oracle is built on its own blockchain, where oracle nodes are required to perform secondary jobs of being block producers/validators of BandChain, which adds no value to the oracle’s job of data delivery. As such, nodes experience high operating costs due to growing state bloat and long sync times as time progresses.
  4. It’s important to note that BAND staking and all of these slashing conditions are only for maintaining blockchain validation and block production, not for ensuring any oracle service reliability or data accuracy. While the Band team has suggested coinvoting in the future to punish validators performing faulty oracle services (which is subject to whale manipulation), this has yet to be developed and remains entirely theoretical.

Team, Funding, Partners, etc.

Funding

"As of September 2019, Band Protocol has used approximately 5% of TGE funds and the team has an expected runway of at least 4 years."

"Binance backs Band, FTX (aka SBF Alameda, the new sushi controller), and Serum (via 3commas Cap)."

Partners

"Band Protocol provides oracle technology on Celo and becomes official mentor on Celo Camp, a two-month-long bootcamp for 18 finalist startups building on Celo’s blockchain technology."

  • Is partners (1-8-2020) with Waves & ICON. Also with Gravity, another oracle project. "Band Protocol will be facilitating a bridge for all participating blockchains on Gravity between all types of data, ranging from on-chain events used in cross-chain operations such as token transfer to external data sources or APIs that power specific decentralized applications. Gravity’s nodes will be able to obtain oracle data from the BandChain decentralized oracle network and relay them to any other blockchain or decentralized application connected to Gravity. For any specific piece of data available on BandChain, it will be possible to prove, from another blockchain, that an oracle query result or specific transaction has taken place on BandChain."
  • Partnered with MANTRA DAO (9-9-2020): "This Band Protocol validator partnership means that BAND holders will be able to delegate and stake their BAND tokens on the MANTRA DAO Platform."
  • Everstale has strategically partnered (2-10-2020) with Band Protocol and been onboarded onto BandChain Mainnet as a validator.
  • From this Cosmos blog (16-12-2020):

"Band Protocol becomes first blockchain project to join OpenAPI Initiative Alongside IBM, Ebay.

(:

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