Arweave

Arweave, a blockchain-based data storage protocol, was founded by Sam Williams and William Jones while they were pursuing their doctoral degrees at the University of Kent. The idea was conceived by Williams during a walk in Scotland, and he brought it to Jones, who helped with the technical details. Initially, the project was named Archain and was established on June 28, 2017. The name was later changed to Arweave in February 2018, and the mainnet launched in June 2018.

Arweave secured significant funding through seed rounds. On November 6, 2019, it raised $5 million led by Andreessen Horowitz and contributions from Union Square Ventures and Multicoin Capital. Another seed round on March 5, 2019, led by Andreessen Horowitz and participation from Coinbase Ventures, raised a total of $8 million.

The project also held an Initial Coin Offering (ICO) starting on June 3, 2018, which raised $8.7 million. The ICO was backed by Arrington XRP Capital, 1kx, Benjamin Kong, and Coefficient Ventures Grand Renfield One. The $AR token was priced at $0.73 during the ICO, and 20.6% of the total supply was available for the round.

Arweave's innovative approach to permanent data storage has garnered significant attention and investment. Its unique model, which incentivizes participants using the $AR token, has made it a promising solution for long-term data preservation.

Arweave is a decentralized data storage network that uses a blockchain-like architecture called the blockweave. The blockweave is maintained by miners who provide disk space and replicate the data stored in the network. In exchange for their services, miners receive Arweave tokens (AR). This incentivizes them to store data over long periods of time, ensuring the permanence of the data.

The blockweave differs from traditional blockchain structures. Each block in the blockweave is linked to two previous blocks and one following block. This unique linking system allows for the Proof of Access (PoA) consensus mechanism. Miners must provide cryptographic proof that they can access a randomly selected "recall block" from the blockweave's history to mine new blocks. This mechanism incentivizes miners to store data for long periods, as they must access older blocks to mine new ones and receive rewards.

Arweave allows miners to establish content policies, which prohibit certain data from being stored. This ensures that miners can choose what data they want to store, and data that does not meet their policies will not be accepted into their transaction pools. Additionally, network gateways and Arweave-based apps can filter data, enabling community-driven content moderation.

The Arweave token (AR) is used to pay for data storage. When data is uploaded to the network, users pay a one-time fee in AR tokens. These tokens are then distributed to miners as rewards for storing the data. The fees do not go entirely to miners; some are deposited into a sustainable endowment that grows by earning interest. This endowment is used to pay for future storage costs, ensuring the long-term viability of the network.

The permaweb is the decentralized web built on top of the blockweave. It allows for permanent, decentralized data storage and retrieval. Permaweb URLs are unique and permanent, ensuring that data can be accessed forever. The permaweb is designed to be community-owned and maintained, with anyone able to contribute or get paid to maintain it.

Arweave has various applications, including ArDrive for file storage and the Arweave web archive for storing websites. It has also partnered with organizations like the Internet Archive to ensure the preservation of important data and to create a fault-tolerant and decentralized data storage system.

Arweave (AR) has several strengths that contribute to its unique position in the decentralized storage sector:

1. Single One-Time Fee: Arweave offers permanent storage for a single up-front fee, which sets it apart from traditional storage providers that charge recurring fees.

2. Blockweave Technology: Arweave's blockchain-like infrastructure, called blockweave, allows nodes to participate in the network without needing to store and sync the entire blockchain. This makes it more efficient and accessible.

3. Proof-of-Access: Arweave's succinct random proof of access ensures that data can be retrieved efficiently and securely.

4. Well-Developed and Accessible Ecosystem: Arweave has a well-organized and user-friendly ecosystem, making it easy for users to interact with the protocol and build applications on top of it.

5. Supportive of Ecosystem Development: Arweave is community-friendly and actively supports projects integrating its technology through dedicated investment affiliates and capital injections.

6. World-Class Investors: Arweave is backed by a strong network of venture capital firms, providing access to top technology and expertise.

7. Powerful Professional Relationships: Over 115 projects, including prominent names like Meta and Instagram, have integrated Arweave into their systems, demonstrating real-world adoption and network effects.

These strengths position Arweave as a leader in decentralized storage, offering a unique and innovative solution for permanent data storage.

Arweave (AR) carries several risks that investors should be aware of:

1. Market Competition: Arweave operates in a highly competitive decentralized storage sector, where market forces can dictate the adoption of its technology. This competition can lead to Arweave being overlooked despite its superior advancements.

2. Volatility: Arweave is considered a high-risk investment due to its volatility. Its price can fluctuate rapidly and unpredictably, making it challenging for investors to predict its performance.

3. Risk of Devaluation: Arweave's market sensitivity and economic sensitivity indicate that it is susceptible to devaluation. This means that its value can drop significantly in response to market changes.

4. Technical Challenges: Arweave's usability is not the best, requiring users to set up an Arweave-compatible blockchain wallet and purchase AR tokens. This complexity can deter users and hinder adoption.

5. Unforeseen Issues: As Arweave grows and stores more data, it may encounter unforeseen technical issues that could impact its ability to deliver permanent storage.

6. Risk of Manipulation: Arweave's price can be easily manipulated by limited trading activity, which increases its risk profile.

These risks highlight the importance of a measured approach when investing in Arweave, and investors should only invest what they can afford to lose.

• Sam Williams: Founder of Arweave, hacker, and CEO at Forward Research. He is a PhD drop-out and can be found on Twitter at @samecwilliams.
• James Piechota: Team member at Arweave.
• Markus Ihringer, CFA: Team member at Arweave.
• Ben Kong: Team member at Arweave.
• Ros Mc Mahon: Team member at Arweave.
• Phil Mataras: Founder of AR.IO, with extensive experience in system architecture. He has been deeply involved with Arweave, creating the Arweave File System (ArFS) and the ArDrive app.