DeFi in Data Economy: Decentralized Data Exchange based on privacy-preserving computation network

Introduction

The world’s most valuable resource is no longer oil, but data. A new commodity spawns a lucrative, fast-growing industry, prompting antitrust regulators to step in to restrain those who control its flow. A century ago, the resource in question was oil. Now similar concerns are being raised by the giants that deal in data, the oil of the digital era.These titans — Google, Amazon, Apple, Facebook and Microsoft — look unstoppable. They are the five most valuable listed firms in the world. The greatest beneficiaries are companies that have both vast data and computation ability, like Google and Facebook.

Our aim is to spread the benefits of data by equalizing the opportunity to access data. To reduce this to a practical goal, our aim is to develop a DeFi system — Data Exchange. This network can be used as a foundational substrate to power a new ecosystem of data marketplaces, and more broadly, data sharing for the public good.

There are serval objectives we will do:

Implementing an automated liquidity protocol based on a “constant product formula” to make the pricing of data be for value maximized. And to archive incentivize putting data in the commons.

The UX of DEX app is the slickest. No more having to make bids or offers or doing heavy calculations. and will definitely lead to a lot of usage for everyday data traders who are looking to get quick and easy access to various datasets.

Based on Alita Network make data available for use by physical scenario like AI and Bigdata, with privacy-preserving. More generally, we will resolve the tension between wanting more data for better AI models, with the individual right to privacy.

We will design a system not only self-sustain but actually improve over the decades, without guidance by a centralized actor. To ensure a spread of benefits and control by privacy-preserving without data collection.

StakeHolders & Process Steps

Data Owner

Metadata is first created by the Data Owner of the asset. During the creation process, the data owner provides the file URLs as plaintext, which will be encrypted by metadata store (In Alita Computing Node) in the backend and stored as encrypted URLs. Metadata store is based on the public DataSet schema from schema.org.

At the same time, in order for more Data-Owners to provide data, Dataset-Maker needs to do a lot of work similar to Market-Making.

Dataset Maker

Only large-scale data collections are valuable, and individual data fragments have limited value. DatasetMaker will create a contract on the main chain and list the token of this data collection with ALITA pairs to a new pool(Dataset). In order to maximized obtain the value of data, DataOwner need to join a certain Dataset and submit Metadata to get the rewards sent by DatasetMaker. The number of liquidity tokens minted is computed based on the existing quantity of tokens. A dataset maker no longer specifies which prices they are willing to sell. Instead, dataset pools everyone’s data supply and demand liquidity together and makes markets according to a deterministic algorithm.

Data Consumer

Data Consumer first needs to prepare a certain amount of ALITA to pay for computing costs. Then use ALITA to buy the token in the Dataset. Based on the federated computing technology of Alita Network, Data-owner’s data is not collected outside the device, but execute outsourced tasks on the device provided by Data-owner. Therefore, the value of data can be measured by complexity of the computation tasks. Calculate how much ALITA the task consumes, and consume the equivalent Data Token.

Data Value Orchestration

1. Data Maker creates new Data Token, and creates Dataset (Pool) in DEX, then designs data requirements, usage scenarios and potential customers. Purchase a certain amount of ALITA in CEX to establish an initial liqutation, and invite community members to join.

2. Community members join as Data-Ower, they will identify data and be rewarded by Data Token.

3. Data Consumer, the commercial data customer, found that an increasing number of data providers in this Dataset, and be interesting in. and purchase ALITA from CEX(Bithumb, Huobi, etc.), and then deposite to the Dataset(Pool) to obtain Data Token. As such users increase, the price of Data Token will rise. Data Consumer will pay Data-Owner Data Token and ALITA as data fee and computation fee.

4. Data-owner can choose to sell the Data Token in hand. Based on a liquidity pricing strategy, it may generate dozens of times more profits.

5. Data Makers earn revenues from transaction fees between Data Token and ALITA

Milestones

It is expected that in September we will release the first demo on testnet2.0, and this DEX will be officially launched on mainnet-v1 in October.