Venture capital firms eyeing NFT trend for business opportunities! Analyzing the potential of decentralized storage project Arweave

NFT is definitely the hottest blockchain application focus in 2021, but it has a flaw that everyone wants to solve: centralized storage issues. NFTs are unique IDs created by on-chain certificates, which are then linked to externally stored media files to present "image/sound forms" of NFTs in different applications. Most of these media files carry the risk of a single point of failure. If the file storage provider or interface ceases operation or changes content, then "your NFT may no longer be what you thought it was."

Venture capital firm Mechanism Capital recently commented on the decentralized storage project Arweave AR, stating that they have invested a certain amount. Their reasons are as follows:

1/ We've recently established a position in Arweave ($AR)

A thread on some of our research, and an update on the current state of @ArweaveTeam

— Mechanism Capital (@MechanismCap) August 17, 2021

Comparable to Centralized Storage Providers

Arweave's solution is not more expensive than centralized storage services like AWS; users can estimate future costs, prepaying for permanent storage expenses. This kind of network is maintained through sustainable economic incentives.

Started Offering Permanent Storage Services

Arweave's application layer permaweb has begun providing permanent data storage services, with services like ArDrive, Koii, vertoexchange, KYVE being used by users.

NFT Storage Applications on the Rise

Furthermore, NFT project Metaplex on Solana also uses Arweave as the default NFT data storage solution.

Issuance of Profit Sharing Tokens PST

Arweave has launched Profit Sharing Tokens PST, allowing developers to incorporate interactive charging mechanisms in applications. The accumulated fees will be distributed to PST holders, and applications can also sell PST to cover expenses.

State Storage

Arweave can also serve as a backup for blockchain state storage, with SOLAR bridge using Arweave to store Solana's state.

Growth of the Arweave Network

Arweave's data storage is rapidly expanding, growing from 1.04 TB to 10.63 TB.

Transaction volume is also continuously increasing:

Mechanism Capital believes that this network expansion stems from NFT issuance and the shutdown of Hong Kong Apple Daily, with recent high transaction volumes due to the popularity of Solana's NFT releases.