Cryptocurrency has been in a mini bull market the past few weeks with Bitcoin rising nearly 50% from its complete collapse after the fallout from the FTX. The rise in Bitcoin prices has brought a breath of fresh air to the cryptocurrency industry and many coins and tokens have seen even more dramatic price increases than Bitcoin.
One such token is Big Data Protocol (BDP), which according to World Coin Stats is up over 350% in the past 24 hours. That’s a gigantic increase in the price and the reason for that goes further than cryptocurrency being in a mini bull market. This article will cover everything you need to know about Big Data Protocol’s meteoric rise over the past week and discuss the long term viability of this small DeFi project.
What is Big Data Protocol (BDP)?
Big Data Protocol (BDP) is a decentralized finance protocol on the Ethereum blockchain. As the name implies, Big Data Protocol is a protocol focused on big data. Specifically, the point is to tokenize data and make it a tradeable, liquid asset.
The protocol launched on March 6, 2021 to quite a lot of success. The trading volume and price of BDP both jumped in the hundreds of percent that day.
But that does not really explain what this protocol actually does, so what does Big Data Protocol actually do?
It’s actually quite simple. First, Big Data Protocol is partnered with Amass Insights, which is an alternative data provider. Amass Insights is also owned by Jordan Hauer, who is the founder of Big Data Protocol.
Next, Big Data Protocol tokenizes the data into a tokenized dataset called bALPHA. Users can earn bALPHA by being a liquidity provider for the bALPHA-ETH or BDP-ETH trading pairs on Uniswap.
Finally, the bALPHA can be redeemed for datasets, which makes bALPHA a tokenized dataset.
It’s a relatively simple process. However, we do see some potential issues with this protocol.
The Problems with Big Data Protocol (BDP)
We see some problems with Big Data Protocol (BDP). These problems mostly relate to the long-term viability of this project. This section will explore these problems.
Does Data Need to Be Tokenized?
The first problem we have with Big Data Protocol, and this is a big one, is a simple one.
Is there any demand for tokenized data?
It might seem that way at first glance, but a lot of the growth with Big Data Protocol has come from users chasing yield rather than people actually using Big Data Protocol to purchase data.
To put it simply, we do not see a need for this data to be tokenized. Furthering this point is the fact that Big Data Protocol does not state the benefit of tokenized datasets anywhere on their website or Medium page.
They simply say that data is illiquid and they are making liquid. That’s great, but who benefits from this liquid data?
We do not see how those purchasing the data benefit from this. And that’s a very important thing. If data purchasers do not benefit from tokenized datasets, then what’s the point of tokenizing datasets?
To us, this looks like a clever way to increase the liquidity of the trading pairs on Uniswap.
Where’s The White Paper?
Another issue we have with this project is that it does not appear to have a live whitepaper. There is a section titled “Docs” on the homepage, but the page returns a 404 error.
This is likely some sort of technical glitch because it does take you to a link.
It’s still not a good look when someone is attempting to read your documentation and they receive a 404 error. They should work to remedy that solution as soon as possible.
The Project Hasn’t Progressed in Years
The final issue we have with Big Data Protocol is that the project has not really progressed in years. This is apparent by looking at the price graph for the BDP token.
It’s just one big jump in the first few weeks and then has bounced off the $0.00 line for the past two years.
One could chalk this up to users losing interest in this project, which is probably the case. It’s a lot more dire for Big Data Protocol, however, because the token price reflects the success of the project. The lack of interest in the project indicates that no one is actually buying the datasets (this would cause inflation as no one redeems bALPHA).
If no one is buying the data, then what’s even the point of the project at this point?
Why Has Big Data Protocol Gone Up 300%?
The price increase in Big Data Protocol (BDP) is most likely due to the announcement of a partnership with Diffbot. Diffbot is basically an on-demand web scraper. It has scraped the entirety of the public internet and then sorted that information into knowledge graphs that can be queried.
Anyway, Big Data Protocol partnered with them. Big Data Protocol will use the algorithms and artificial intelligence (AI) to help better organize their data. These algorithms can be used to improve the accuracy of the Big Data Protocol databases.
Is Big Data Protocol a Good Investment?
First of all, this should not be construed as investment advice. We like the idea of Big Data Protocol, but we do not see it as a particularly viable solution at the moment.
We simply do not see how those that purchase data will benefit from tokenized datasets. And Big Data Protocol did not elaborate on how their protocol can improve the data industry.
This looks like one of those Web 3 projects where a developer made a Web 3 “solution” that was not needed. Of course, this could change in the future or we might be missing information. However, we simply do not see the utility of this protocol in the current market with the information that Big Data Protocol has provided to the public.
To summarize, Big Data Protocol appears to be a dead project that has seen a recent bump to a key partnership announced at a time when AI and machine learning are of great public interest. There are still unanswered questions about the utility of this project and it’s future remains uncertain.
Carolyn Coley is a blockchain reporter. She joined Smartereum after graduating from UC Berkeley in 2018.