What is Arweave and the AR Token?

Written by Ivan on Tech

August 28, 2021

The Arweave project is a decentralized data storage solution operating with blockweave technology and the native Arweave token (AR). Users of the network can pay a one-off endowment to use and provide permanent and immutable data storage. Anyone can contribute to the network by renting out unused storage space on their computer. Furthermore, the Arweave project uses the novel Succinct Proofs of Random Access (SPoRA) consensus mechanism to maintain stability and security throughout the network. Alongside this is the ‘permaweb’. The permaweb is a community-owned network that operates just like the traditional web. However, once a user adds data to the permaweb, it cannot be altered or removed, even by the creator.

In this article, we’re going to dive deep into the Arweave project. Also, we’ll discuss the Arweave token (AR), the Arweave wallet, blockweave, and the underlying technologies of the project. Plus, we’ll explore the Succinct Random Proofs of Access (SPoRA) consensus mechanism and the decentralized data infrastructure Arweave provides for the Solana blockchain using the SOLAR Bridge.

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What is Arweave?

Arweave is a decentralized data storage protocol that provides an economically sustainable, “permanent serverless web” and data storage service. Users of the Arweave project benefit from data storage that uses perpetual endowments. This enables users and developers to store data permanently using a collectively owned distributed server.

Blog Arweave project

Furthermore, Arweave facilitates information permanence and immutability to help preserve valuable information for various use cases. Anyone with spare hard drive space can earn a passive income by renting it to other users throughout the network. Plus, as a community-owned network, anyone can build on Arweave and contribute to the development of the ecosystem. 

The Arweave network neither operates nor is owned by any single company or entity. Rather, it is a fully decentralized network with no single-point-of-failure. This means that anyone can provide storage space or use the network to store data. Plus, the data archiving and storage solution provided by Arweave replicates and distributes data across hundreds of computers across the globe. As such, the data held on the network cannot be lost due to damage, fires, or floods, as it could be with centralized data storage solutions.

The Arweave Token (AR)

The native Arweave token (AR) token is a multi-utility token used throughout the Arweave ecosystem. Moreover, the AR token provides a crucial foundation for network security through incentivization. With two primary use cases, the AR token rewards network miners and pays for data upload fees within the network. Network miners must first store and serve data to mine fresh AR tokens. Furthermore, a participant in the network can use the same crypto wallet address for being both a user and a miner. 

Blog Arweave token

At the time of writing, the total supply of AR is 66 million, and the current circulating supply is 43.8 million, according to CoinGecko. The AR token sits at a value of around $25, following its all-time high of $44 in May 2021. 

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The Permaweb

The permaweb is a worldwide community-owned web. Anyone can contribute to the permaweb to maintain it and receive payment for doing so. On the surface, the permaweb appears to be just like the normal web. However, all content the permaweb holds is permanent, decentralized, and easily retrievable. This includes images, text, applications, and just about anything else that lives on the web.

AR token

The permaweb is a collection of documents and applications interlinked on top of the Arweave data storage layer. Once a user adds content or data to the permaweb, it is immutably stored and will always be accessible (with the exception of illicit or abusive content). Following the submission of files to the permaweb, nobody can alter them, including the publisher. This encourages integrity and verifiability throughout the network. 

Blockweave and Proof of Access (PoA)

One of the foundational technologies that powers the Arweave project is the blockweave. The blockweave is a derivative of blockchain technology. The blockweave data structure was purpose-built for the Arweave protocol. A blockweave works in a similar way to a blockchain in that it is a connecting chain of blocks full of transactions linking to previous blocks of transactions. However, the blockweave data structure requires all miners within the network to present a ‘Proof of Access’ (PoA) to historical data before they can add new blocks to the chain.

Blog blockweave

Whereas many blockchains require miners to use electricity to earn mining rewards, miners throughout the Arweave network use data replication to receive rewards. This means that, in order to earn mining rewards, miners must share valuable information held across the decentralized network. This makes blockweave and Proof of Access (PoA) more energy efficient than most blockchain networks. 

Succinct Proofs of Random Access (SPoRA)

Succinct Proofs of Random Access (SPoRA) is an improvement on the PoA consensus mechanism. SPoRA increases miner incentives and further promotes competition for data retrieval. This works by reducing incentives for CPU resource pool mining. Moreover, SPoRA creates more compelling incentives and gamification techniques to encourage decentralization.

Wildfire

For the Arweave data storage system to perform at optimal levels, data must be transfers must be quick, efficient, and be instantly accessible. Plus, access to data must be free wherever possible. To address this, the Arweave network uses an additional incentive layer to make the sharing of data free.

Blog blockshadows

Wildfire is a ranking system based on how quickly network nodes can respond to and fulfill data requests. The faster a network peer can distribute new blocks and transactions to the network, the higher they rank. Moreover, peers with the highest rank receive data requests first. As such, network peers have financial incentives to fulfill data requests as quickly as possible, increasing their chances of completing further data requests. Plus, any peers that severely underperform can be blacklisted from the network entirely.

​​Blockshadows

Traditional blockchains usually distribute a full block to each node in the network after mining new blocks. Even if a node already has most of the data within a block, they still receive a duplicate. Not only does this make reaching consensus slower, but it also wastes resources when broadcasting vast amounts of data unnecessarily. 

Blog wildfire

Blockshadows addresses this issue by minimizing the amount of duplicated data broadcast throughout the network. As such, the network can achieve consensus much faster. Plus, the throughput of the network increases as a result. This works by decoupling parts of transactions from blocks. Instead of sending full blocks to each node, nodes in the network receive a reduced block “shadow”. Peers can then reconstruct this reduced block into a full block.

Moreover, the blockshadowing system facilitates flexible block distribution with ultra-fast transaction speeds thanks to the expediting of network consensus. Plus, the fluctuation of network fees during times of congestion is relatively low.

Storage Endowment

The Arweave blockchain data storage solution uses “sustainable, transparent economics” to facilitate the continuous replication of data. Much like an economic endowment structure found in traditional finance, users must make a payment of an upfront ‘principle’ to add data to the Arweave network. 

After the payment of this principle, data storage purchasing power makes up the ‘interest’ that accrues over time. Following a one-off initial payment, network participants can then earn a passive income by providing hard drive space for data storage. Estimates for data storage pricing are very modest to maintain the long-term sustainability and growth of the endowment mechanism.

Content Moderation

The democratic moderation of illicit and abusive material is of the utmost importance to the Arweave team. Just as the traditional web monitors and moderates such content, so too does the Arweave network. However, the Arweave community uses a range of tools to ensure that censorship only occurs when it is necessary. Tools for achieving this are built into the Arweave protocol, allowing network users to decide what content should be available and what should be prohibitively inaccessible.

Blog moderation

When a user submits a transaction, data storers have the option of replicating the associated data. Data storers can filter and screen any content to ensure that users do not gain exposure to illegal or otherwise unsavory material. Plus, if they deem any data to be abusive, they can simply choose not to broadcast it. Also, Arweave works closely with the Internet Watch Foundation to minimize the broadcasting of offensive and harmful material. The servers used to view the permaweb can implement further moderation policies to safeguard users should illicit data be broadcast. Furthermore, users of the permaweb can report abusive material to Arweave to have it removed.

Solana Blockchain

Solana is the fastest blockchain in the world at the time of writing. The innovative blockchain produces blocks every 400 milliseconds. From the user-end, Solana is one of the most cost-efficient smart contract-enabled blockchains. Under the hood of Solana, the protocol breaks down into four key layers. First is the core blockchain layer, then there is the infrastructure components layer, the protocol layer, and finally, the user-end layer for asset management and aggregators. Arweave plays a critical role in the infrastructure layer, facilitating decentralized storage for Solana. 

Blog solana

Estimates suggest that Solana produces up to four petabytes of data each year (or 4,096 Terabytes). As such, Arweave and Solana are introducing the SOLAR Bridge as a result of their partnership. The SOLAR Bridge is tailor-made to enable Solana to store data on Arweave’s permaweb. This creates a decentralized, easy-to-access, and publicly available storage solution that can handle immense scalability. Moreover, Arweave is paving the way for decentralized storage options interoperable with other blockchains in the industry. 

Arweave Wallet

To interact with Arweave and use the AR token, users must first download and install the Arweave wallet. The Arweave wallet is available as a web browser extension for Chrome, Firefox, and Brave. Furthermore, the Arweave wallet serves as a cold storage wallet and is currently the only hardware wallet that supports the AR token. However, in the future, the AR token may be compatible with other cold storage wallets.

Arweave and the Arweave Token (AR) Summary 

The Arweave project connects people with spare hard drive space with people who need permanent data storage. Plus, Arweave aims to provide a sustainable and permanent decentralized ledger of data, knowledge, and history while creating mechanisms to incentivize the efficient transfer of data.

Blog Arweave wallet

Furthermore, thanks to the Arweave token (AR), the permaweb, blockweave, and the Succinct Proofs of Random Access (SPoRA) consensus model, the Arweave project enables unparalleled data replication without intermediaries.

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Also, don’t forget to follow us on Twitter @Academy_IOT! We’d love to hear your thoughts about the Arweave project and the Arweave token!

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