The Graph: Network Overview

5 min readDec 22, 2020


Since its inception in 2018 and strenuous development over the past three years, The Graph and its ecosystem is comfortable enough to begin the transition to full network decentralization. The first piece of this puzzle was Graph’s Token Generation Event which deployed and launched Graph’s own ecosystem token (GRT) to the actors in the network. With GRT, indexers have redeployed their infrastructure over to the mainnet and have since started to earn a part of their eventual revenue — indexer rewards. These rewards constitute The Graph’s built-in 3% inflation metric designed to reward Indexers for maintaining and providing constant up-keep of their nodes, which in turn queries the Ethereum network.

The Graph Network page

Network statistics:
• 108 Indexers
• Over 200,000,000 GRT Indexer stakes locked
• More than 2,300,000 GRT indexing rewards over the last 8 epochs
• Over 100,000,000 GRT delegated
• 700,000 GRT delegating rewards


In the current environment with things evolving very quickly, it’s prudent to keep a few things in mind when it comes to delegating. When choosing an optimal indexer, the optimal parameters from a delegator standpoint are as follows:
• Stake owned (Higher = Better)
• Rewards cut (Lower = Better)
• Node uptime (Coming soon)
• Revenue strategy
• Transparency

Indexer stake influences the total indexing rewards a particular node will receive.

Rewards cut is the percentage of indexer rewards the Indexer keeps when splitting with Delegators.

Node uptime tracks node reliability when indexing on-chain events. Currently there’s no way to check overall uptime statistics, but it is being tracked in the backend and used to determine the utility score of every Indexer node.

Revenue strategy is different for every Indexer based on their revenue expectations. Some Indexers may offer stable and reliable income strategies while others may provide an experimental revenue strategy that may be more lucrative, but riskier. Delegators must factor in their own expectations and preferences to choose the optimal node.

Transparency of Indexers in the community is important when performing due diligence as it gives a rough idea on how the Indexer expects the network to evolve in the near future and respond to these circumstances. This is currently evolving at an incredibly fast rate and encouraging to see Indexers slowly step up and engage with the larger community to build up their trust and reputation in the market.

A great example of an Indexer providing transparency and reputation building in the community

The hallmarks of a good Indexer will be their openness with the community about the infrastructure they run, the methodology, node monitoring and control, revenue strategy and lastly, their ethos. Most importantly, they will be transparent on their reward sharing strategy by announcing any future changes when it comes to delegator rewards. This is done mainly on Discord now, but developers are promising additional UI upgrades on the main network page.

The community has released a spreadsheet calculator which roughly calculates the rewards for delegating. Staking Facilities, one of the Indexer nodes, has also released a detailed step-by-step guide on how to delegate GRT tokens on a particular subgraph. In essence, the current formula for calculating Delegator Rewards (DR) can be summed up through a few variables:

Total Indexing Reward is the amount of GRT tokens Indexers procure through indexing efforts every epoch (currently 24 hours).

Rewards Cut tells us how much of the total Indexing Rewards is channelled towards Total Delegator Pool. From a Delegator point of view, less cut equals nominally larger pool for Delegators.

The last fraction determines how much rewards are entitled to every Delegator based on the size of their stake. The bigger stake a particular Delegator provides, the more rewards he is entitled to at the end of the epoch when allocation close.


Delegating tokens is a risk-less strategy of earning a passive reward by delegating GRT tokens to Indexers and which also helps secure the network.

Delegated tokens are not at risk of slashing if an Indexer engages in malicious or incorrect behaviour by reporting the wrong data. Therefore, there is no risk of loss to the GRT tokens delegated apart from the entry 0.5% deposit tax.

All rewards are automatically re-delegated until withdrawn.


Indexers may increase the reward cut substantially after you delegate, resulting in little to no delegation rewards. This is a possibility, but Indexers may face harsh criticism and drop in reputation and standing in the community, so it is considered highly unlikely in the long run. Short term fluctuations will occur as network participants figure out the network parameters for themselves and optimize their strategies for long term sustainability. Low reward cuts may look tempting, but I would advise caution and prudence as Indexers may run at significant loss by subsidizing delegation rewards, but is not sustainable and reward cuts will be prone to significant changes.

Indexers will be limited in their capacity to change their parameters in the coming weeks. This is determined by Parameters Cooldown parameter, which will increase as network and market conditions stabilise and provide a predictable revenue in the future. In optimal conditions, this cooldown will be equalized with the Delegator Thawing Period, which sits at 28 days.

Another danger of delegation is not focused on Graph’s ecosystem, but of the market sentiment at large. Upon delegation, participants’ tokens are locked for 28 after un-delegating and are therefore exposed to GRT price fluctuations, which is in turn affected by overall crypto market conditions. Therefore, Delegators are vulnerable to price action swings which should be assessed before delegating.

Thirdly, there is always the possibility of a smart contract risk in the base layer of Graph network which may be taken advantage of by a malicious actor and could result in loss of funds. The team has taken protocol security extremely seriously, engaging with several auditing companies to increase confidence in security. They have also announced Bug Bounty program for individuals or firms to identify and disclose potential protocol vulnerabilities in exchange for financial compensation.


Delegator rewards are not allocated automatically in real time as Indexers must close their allocations on the subgraph prior to distribution. This is done on every epoch cycle end, which is currently 24 hours.

Indexers face a 2.5% slash on their stake if their node reports incorrect data.

The team has released a short delegation FAQ which should answer most basic questions.

The Graph:
The Graph Blog:
The Graph Network: