Towards A New Data Marketplace: Ocean Protocol V3 Release

By now, everyone has heard the refrain “data is the new oil”. This metaphor grows more accurate the deeper you take the metaphor.

Data in its raw form, like unrefined oil shares multiple similarities:

• Both resources are hard to utilize in their unrefined forms
• Data is costly to manage and store on an ongoing basis, although not as expensive as oil
• Data and oil require multiple levels of expensive processing. For data, this comes in the form of data cleaning and labeling

However, a key difference is that the same data source can be consumed multiple times and combined with other information to provide greater value. Data becomes useful when individuals or entities can connect the dots.

Source: David Somerville™ @smrvl

How Ocean Protocol is Creating Value-Add Data

Ocean protocol is built for data scientists. While data visualizations are often the viral components of a data scientist’s work, the vast majority of a data scientist’s time is spent gathering and cleaning data before analysis. Valuable data requires effort to collect, such as web scraping millions of websites, transcribing audio to text, or other technical and tedious tasks. Data cleaning (labeling, filtering, editing) similarly requires time and methodical effort to parse through.

Ocean Protocol recently released V3 of its protocol this week which supports exciting concepts like a data marketplace, datatokens, and initial data offerings (IDOs). These new features enable data scientists and engineers to enhance their work process by creating an open ecosystem for selling or purchasing valuable data.

Ocean Protocol’s new datatokens are representations of datasets or data services where one datatoken unlocks access via Ocean smart contracts. Datatokens are ERC-20 tokens that can be listed on exchanges or compatible with DeFi protocols for the purpose of lending, derivatives, or other functions.

As the world shifts to tokenizing all types of information, datatokens represent a unique opportunity for commoditizing the value transfer of data and information. However, information that is valuable to companies is usually sensitive. Consumer healthcare information, immigration status, and identification data can be manipulated or abused if shared incorrectly. To this end, Ocean’s “compute-to-data” feature allows data publishers to sell private data while preserving privacy.

Additionally, datatokens are publicly tradeable on Ocean Market, a decentralized exchange powered by Balancer where individuals (data curators) are able to identify quality datasets and stake OCEAN tokens on the credibility of the dataset.

Source: Ocean Protocol Dataset Liquidity Pools

Stakers are paid proportional to the sales volume on the datasets that they claim are credible.

However, one of the most exciting features of the V3 Ocean Protocol release is the potential for data token sales. Similar to Balancer's initial token offerings, Ocean Market will support initial data offering (IDOs), whereby datatokens for a corresponding dataset and OCEAN tokens will be issued into a pool. Datasets and respective data tokens can be created by anyone and priced according to the data’s value. However, the more valuable datasets will likely be those with added value, whereby a data scientist or analyst has already processed, labeled, and refining the data.

The commoditization of data has yet to be achieved because data is siloed, sensitive, or proprietary. Ocean Protocol is a new solution to create an open marketplace where sensitive data can be shared and proprietary data can be accurately priced and sold. Turning data into tangible data assets (tokens) will unlock value, developing a more robust data ecosystem.

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