Ocean Protocol Where Blockchain & Big Data Collide

Sepehr Vafaei

What is Ocean Protocol and why is it a huge investment opportunity?

You might have heard that data is the new oil. For example, just consider the valuations of companies like Amazon, Facebook, and Google. In our increasingly digitized economies, data now drives an ever-increasing amount of global business. We are talking about data worth trillions of dollars. Even though this is good news for data-hungry AI but according to McKinsey less than one percent of global data is analyzed. Wouldn’t it be great to use more data and leverage AI for humanity's benefit? Well, there is a project called Ocean Protocol.

In the current data economy, the main problem is connecting problem solvers and problem owners and giving them the right tools and resources for solving. For example, climate change is one of biggest humanity's problems. Maybe a group of climate scientists wants to find a solution. They might want to access private data from another country to help solve that problem. Connecting all these actors and getting that private data is really difficult, so that poses a major question: how can we unlock access to private data? after all that’s probably the most valuable data.

Basically, Ocean Protocol wants to be a unified layer that connects the problem, the solver, and the data. It allows problem solvers to go to one decentralized place that acts as a sort of public utility and connects them with the resources they need to solve that problem.

Another cool thing with ocean protocol is that it wants to protect private data but allows data scientists to train models with that data. The project solution is to create a data privacy zone that allows data scientist to send their algorithm into it test their model with that data and allow the findings to be extracted.

I want to move on to tell you a bit about the tech that powers the ocean protocol platform. In short, ocean protocol is a decentralized Ethereum powered smart contract platform running on proof-of-authority. This enables the safe sharing of data and ensures payment to the data provider whilst guaranteeing control, audibility, and transparency to everyone.

Ocean Protocol Main ComponentsSepehr Vafaei

You might have a user that wants to use a library to interact with ocean protocol. The protocol itself is kept alive by nodes called Keepers which are ultimately responsible for ensuring that the network is running optimally. Then there is something called the Parity Secret Store which keeps that private data private. You then have two key microservices. The first one is a component called the Brizo (cloud services manager) which acts as a proxy to preserve your privacy but allows you to access data on the platform. Next, you have a metadata store called Aquarius.

AI assets basically have three core separate components on ocean protocol. The first is that assets are registered on the blockchain, meaning that each asset has its own unique id. Secondly, it has metadata attached to it which describes the asset or data set. Finally, the data needs to be stored somewhere. So what are these AI assets of which I speak?

Well, you could register raw data and publish it as an asset using ocean protocol. However, considering the data science workflow, you’ll probably notice that model pipelines, trained weights, or pre-trained data models and metrics could all be pretty valuable AI assets. You could register all of these as assets on the platform too and retain ownership of them via a private key. After all, it can take a huge amount of effort to create model pipelines, train data models, and determine metrics so it can be really useful to share these assets and potentially monetize them.

Once that AI asset is published using ocean protocol, it’s searchable by anyone in the world. Even better, the asset is very difficult to censor due to being on the blockchain. That’s very useful for people like journalists in authoritarian countries who might want to share data proving corruption for example.

Money-related data is pretty sensitive, so how can people safely use sensitive data like your banking history? That sounds terrible, but who knows, maybe some number-crunching whiz kid can solve all of the world’s socio-economic problems with access to that sort of data at scale. The important thing here is that you certainly don’t want that type of data being released into the wild. You don’t even want people to be able to download that data onto their computer while giving them the option to give it or sell it to someone else. Basically, ocean protocol solves all that by keeping the data behind a firewall and only allowing participants using that data to send in their algorithm, train it privately, and create a private model. This model will only release predictions to the user. This is a pretty smart solution.

So you now know that ocean protocol is all about powering a two-sided data market with data providers on one side and data consumers on the other. that’s pretty good news for AI, however, a more important question is that concerning the value of the ocean token, so let’s get into that.

The ocean utility token, OCEAN, is used as the unit of exchange for buying and selling data, AI assets, and AI services. So if there’s no data changing hands using the protocol then the token is worthless. A good example is Airbnb. For a marketplace like that, how do you get the ball rolling? Well if you have a lot of customers who want vacation rentals and no properties are listed then the platform would not have been successful. That’s why platforms like this, initially focus on building up inventory on the platform before looking to send buyers over there.

Basically, there will be four ways to earn OCEAN tokens:

  • Provide data
  • Curate data
  • Be a marketplace
  • Provide network services

Ocean has to make a great effort to incentivize those value-creating behaviors. The Big Data sales hit 187 billion dollars in 2019, so if ocean protocol can even grab a fraction of that market then there’s going to be a sizable demand for ocean tokens to buy all that data. Given that Ocean has a hard cap of 1.41 billion ocean, then an increase in demand for the ocean token should lead to an increase in price.

Coinbase has been reviewing ocean protocol for possible listings. So if you’re the type of person that thinks Coinbase listings are good for the price you might want to keep tabs on that but do remember that right now demand for the ocean token is being driven mostly by speculation and that its value will only be validated if ocean protocol succeeds in creating a successful data marketplace even then price appreciation will be driven by demand-supply imbalance.

Mark Cuban is also one of the famous investors in OCEAN.

Thanks for reading. I write on money, having a healthy lifestyle, and business. You can follow to stay updated.

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