Covalent is an initiative that facilitates rapid and extensive access to blockchain data from more than 200 distinct chains. The project uses big data processing technologies to make sense of hundreds of billions of data points. By giving investors insightful information and assisting developers in concentrating resources on important goals, it increases value for businesses.

Blockchain data from several sources is gathered, processed, indexed, and stored by Covalent in a local data warehouse that customers can access via a single API. In order to ensure security and standardize blockchain data with encryption throughout this process, Covalent leverages proof-of-stake via Moonbeam. This enables data queries from any chain through a single API.

$CQT: Covalent Native Token

The native token of the project, known as the Covalent Query Token (CQT), serves three primary purposes and is extremely important.

~ As a governance token, CQT enables holders to cast votes on ideas to modify system specifications.

~ Validating nodes are rewarded with CQT, a staking asset, for processing and answering data requests.

~ Users utilize CQT as a network access token to use Covalent's API interface to query data.

At the moment, identity management and decentralized finance (DeFi) are the two main applications of the Covalent API. But if the network grows and more businesses use blockchain technology, the Covalent API's usefulness may spread throughout the industry.

The platform also lets developers build API endpoints that they can list for sale on data markets. Without requiring configuration or altering current infrastructures, developers may use the Covalent API to build new apps and enhance existing ones.

How Does Covalent Work

For data retrieval, storage, and query procedures, several roles are required to provide more access to blockchain data:

Validators ensure that participant conduct is truthful and that data is accurate. A user must stake CQT tokens in order to become a validator, and their staked tokens may be cut if they behave maliciously.

By operating a node on the different blockchains that Covalent collects, Block-Specimen Producers compete to obtain accurate and timely data from those chains. Block-Specimen Producers post the blockchain data to a storage node (which they may operate) when it has been gathered, and they are rewarded with CQT.

Indexers are working feverishly to generate and post findings to the Covalent network. Their duties include gathering the data, verifying its correctness, and publishing the findings to the storage network.

Storage-Request Responders retrieve the information that end users of Covalent have requested, enclose the signed request in an envelope, and deliver it to the Covalent chain. Responders to storage requests interact directly with other nodes, giving them the ability to evaluate the features and costs provided by different network users.

On the Covalent blockchain, Query-Request Responders perform a function akin to that of storage-request responders. However, instead of leveraging pre-existing internal data preserved on the chain, query nodes primarily manage external queries made through Covalent's API.

Directory Service Nodes assist Covalent clients in locating the best nodes for a given data request at a pricing point that corresponds to the precise resources and capabilities they need.