Verida Protocol

Review

Published in

SidusPad

7 min readMar 27, 2024

Introducing Verida Network — a decentralized infrastructure for private user databases that will be presented during the IDO on SidusPad. Here are more details about the platform, its features, tokenomics, Early Investors, and more.

About the Project

Verida Network was created with one fundamental mission — to give users control over their personal data and agency over their choice of how to interact with the digital world. Furthermore, Verida strives to resolve the data trifecta, bringing users privacy without sacrificing security and governance. According to the project, they seek to create an “era of hyper-personalization,” where user data belongs to individuals, is private, and consensually accessed to create new products and services.

Verida Network also provides the technology and tools to bring that vision to life. One of those tools is Verida Wallet. In detail, the Verida Wallet is the first mobile crypto wallet to support Polygon ID ZK credentials. It allows individuals to prove only the information required for a transaction (e.g.: age over 21) without exposing any private information (e.g.: date of birth).

Verida Protocol Principles

The Verida Protocol is designed based on the following principles:

Security is paramount and must not be compromised
Users come first
Embrace open-source software principles
Ensure compatibility with Enterprise use
Maximize data portability
Write data once, access everywhere
Use blockchain-agnostic solutions where possible
Streamline onboarding for users and developers

Verida Network passed an audit on Hashlock and got the highest security rating, reserved for projects that ensure ongoing security via bug bounty programs or on-chain monitoring technology.

Market Perspectives

The global market for database management services in Web2 amounted to $82.5 billion in 2021 and is expected to reach over $200 billion by 2027, with a 14% compound annual growth rate (CAGR). Verida’s DbStore solution, which powers the Verida Network, is a NoSQL (non-structured query language) document database. Akin to MongoDB, but decentralized. As a point of reference, MongoDB commands a formidable $25 billion market capitalization as of Q1, 2024.

Current challenges

The Web3 technology stack is still in its infancy and lacks the infrastructure needed to build feature-rich, powerful applications that can compete with Web2 incumbents.

Blockchain brings decentralized computation and Inter-Planetary File System (IPFS) introduces decentralized storage for public data. However, a full end-to-end technology stack also requires identity, authentication, messaging, and personal data storage.

Decentralized personal data storage doesn’t exist

In the Web3 future, users must have ownership and control of their own data. This requires a new type of decentralized data storage infrastructure that is designed for private, personal data. Incentivized decentralized storage networks such as Filecoin (based on IPFS), Sia, and Arweave have seen significant growth through 2021. The Internet already offers a robust and well-established decentralized storage model, so the key innovation provided by these networks is the distributed, permanent, tokenized storage of public data. A public data infrastructure is already commoditized and cheap, presenting challenges to broad adoption beyond ideologically aligned proponents of decentralization.

Additionally, these services do not meet the necessary requirements to build feature-rich Web3 applications that offer comparable performance, availability, configurability, and security that users and developers are accustomed to with Web2.

For example, IPFS is fundamentally based on torrenting technology. It’s great for sharing public data in a redundant and distributed manner, but it isn’t designed for securing private personal data. It is slow, lacks access controls, and the data is distributed in a way that users can’t control. This introduces regulatory issues, such as the lack of guaranteed storage in a particular country.

Verida’s Solutions

Verida’s Storage Node infrastructure addresses these gaps by providing private encrypted databases, user control over where and how their data is stored, real-time synchronization, permissioned data access, and client-side encryption. This approach ensures decentralization of private data, as well as decentralized control, but without the added shortcomings of uncontrolled public distribution.

Identity, authentication, authorization, and encryption are anchored by a user’s private keys. The personal data itself is encrypted and stored on-chain, with tight authentication and access controls.

*Comparison of Web2 and Web3 Core Components*

VDA Token

The Verida Storage Credit Token (VDA) creates a data economy that enables secure interactions between accounts to facilitate secure data storage, trusted sharing, and fast querying.

The initial economic stakeholders are:

End users: Use applications and pay for storage and application subscription fees on the network
Applications: Earn revenue from user subscriptions and by generating valuable data and may pay storage fees on behalf of users
Storage Node Operators: Stake tokens to earn an income from providing storage capacity to the network

Creating a native token allows for the design of economic incentives in the Verida Network. It provides control over the setting of monetary policy and equitable rewards for all network participants. The VDA token is deployed on a permissionless blockchain (Polygon PoS) and therefore inherits characteristics of any other ERC-20 token.

The Verida Foundation will drive growth through various incentive programs based on the following areas:

Connecting data: Users can earn tokens by pulling their personal data from Web3 applications into their Verida Identity.
Connecting a node: Users can earn tokens by operating an infrastructure on the Verida Network.
Connecting a friend: Each user can earn tokens by referring friends to join the Verida Network.
Connecting an app: Users can earn tokens by building a Web3 application that leverages the Verida Network.

*Verida Network Growth and Adoption Framework*

Tokenomics

The VDA token is NOT a governance token and is not for speculation. Its primary purpose is to facilitate the storage economy for data stored on the Verida Network and reward Early Users for driving growth and adoption of the Network. Thus, the Network Growth Rewards take up 20% of the token supply, while 17% goes to the DAO.

Partnerships

Verida has established strategic partnerships with aims to grow its Network through a two-pronged approach; i.e. partnerships for enterprise solutions and partnerships with Web3 native ecosystems.

The list of notable partners includes Gate.io, a crypto exchange with a daily trading volume of over $1.3 billion, Near Protocol with a market cap of over $8.3 billion, open-source protocol Wallet Connect, Polygon ID toolkit, and others.

View the full list of Verida Ecosystem Partners

Online Traction

Over 50,000 Identities, and 30 storage nodes deployed globally.
150 storage node operators in the pipeline for the Foundational Node Operator launch
Over 25,000 people оn the waitlist for the launch of Verida One (Q2 2024)
Top-tier Exchanges and Partners lined up
Nearly 84,000 community members on Twitter
12,000 community members on Telegram
Over 22,000 community members on Discord

Roadmap and Updates

Verida has devised a detailed Roadmap, which includes plans for the current year, and the passed milestones crucial for the Project’s development. The project launched its Decentralized Acacia Testnet in Q3 2023, as well as Myrtle Mainnet Alpha in Q4, 2023. As mentioned, Verida also launched the VDA token in Q1, 2024, and implemented its economic model. Notable plans for the coming quarter include Verida One launch, and functionality of Mainnet nodes operated by verified participants.

Take a closer look at the Roadmap here: https://www.verida.io/roadmap

Project team

The core of the team — co-founders CEO Chris Were and COO Ryan Kris are joined by an experienced, globally distributed team, supporting engineering, product, community, and ecosystem activities.
The full team is presented on the Verida website. However, here is a short introduction to the co-founders, their background, and previous experience.

Chris Were, CEO and co-founder

Chris is an Australia-based technology entrepreneur who has spent more than 20 years developing innovative software solutions. He’s led the development of Verida, a decentralized, self-sovereign data network. Chris previously co-founded Community Data Solutions, providing secure CRM solutions for not-for-profit organizations and government, growing the company to 150 enterprise customers across Australia.

Ryan Kris, COO and co-founder

Ryan has spent the last 20 years in business operations, delivery, and consulting roles across finance, telco, cyber security, and blockchain. He believes in a future driven by decentralized technologies, where people will have sovereignty and ownership over their personal finances and data. As COO at Verida, Ryan manages the strategic operations of the business, including finance, risk, partnerships, marketing, and community.