Why Web3 Needs Data Lakes

With the development of the Web3 cross-chain ecosystem, on-chain data is experiencing explosive growth. However, whether it is the contract interaction records of DeFi or the historical transaction trajectories of NFTs, it is difficult to efficiently obtain and analyze this data. If this data cannot be uniformly accessed and queried, it will greatly limit the development and innovation of Web3 applications.

Therefore, a data infrastructure similar to a Web2 data lake (such as Snowflake) becomes crucial. However, what Web3 needs is a decentralized, verifiable, and open-access data lake architecture.

The core architecture of SQD

Figure:https://www.sqd.ai/

SQD Network provides a “modular + verifiable” Web3 data lake solution, establishing the following mechanism:

• Data Upload: Data providers upload blockchain data to permanent storage (such as S3 + IPFS backup).
• Decentralized Distribution: Data is randomly distributed to worker nodes after being chunked, ensuring redundancy and availability.
• Query Service: Work nodes use high-performance databases such as DuckDB to respond to query requests.
• Verification mechanism: All query results come with node signatures, which can be submitted on-chain for verification, eliminating fraud.

This architecture not only ensures data availability and credibility but also achieves highly cost-effective scalable query capabilities.

Query Verification and Node Roles

Each query request is submitted through the gateway, and the number of requests for the gateway depends on the amount of locked SQD (which generates virtual CU). The query results can be verified on-chain after being signed:

• Proof by Authority: Verification results by whitelisted addresses;
• Optimistic verification: Counterexamples can be submitted within a set time.
• Zero-Knowledge Proof (ZK): Provides zero-knowledge proofs to verify whether the response is accurate.

This layered verification architecture enables Web3 data to be queryable, trustworthy, and traceable.

Detailed Explanation of SQD Reward Mechanism

Nodes earn rewards in the following ways:

• Basic earnings: Obtained based on staking and online time;
• Traffic rewards: Calculated based on the ratio of processed data traffic (scanning and returning);
• Delegation rewards: SQD holders can delegate to nodes and receive 50% of traffic reward sharing;
• Dynamic Adjustment: The reward rate automatically balances according to network load and staking amount, up to a maximum of 70%.

In addition, the initial fixed supply of the reward pool is 10% of the total SQD, and after three years, the governance will decide on the inflation and issuance model.

Token Economics and Governance Design

SQD, as the core token, has the following functions:

• Network Incentives (Staking and Delegation)
• Check computing power quota (lock-in exchange for CU)
• Governance Voting (Adjust Parameters and Proposals)
• Trust Signal (Select Quality Nodes)

This design enables the entire network to establish a sustainable incentive mechanism and governance model without the need for centralized control.

Future development potential

With the addition of more supported chains (such as Cosmos and Solana), the launch of advanced SQL query capabilities, and the gradual takeover of governance by the community, SQD Network is expected to become the data hub of Web3, providing a solid data foundation for applications such as AI, DeFi, and blockchain gaming.

In the long run, SQD will lead the paradigm shift of Web3 from “asset-driven” to “data-driven”, promoting the real implementation of the data economy.