Numbers Protocol Research Analysis

Numbers Protocol

                  — — — a decentralized photo network

 

Abstract

Numbers Protocol aims to build an ecosystem being similar to 500px.com based on Web 3.0 storage and distributed-ledger technologies. Users or cameramen can upload their photos to Numbers Protocol. Then their photo assets are stored on blockchain in the form of NFTs. Asset owners can be rewarded for creating content or someone purchased their NFTs.

 

Token Specification

Token Name: Num Token

 

Token Ticker: NUM

 

Max Supply: 1,000,000,000

 

Circulating Supply: 155,928,565(16% of max supply)

 

Market Cap: 9,633,563 dollars

 

Contracts:0x3496b523e5c00a4b4150d6721320cddb234c3079, 0xeceb87cf00dcbf2d4e2880223743ff087a995ad9

 

NUM is the native token of Numbers Protocol, which can be used to incentive content creators, and any other nodes within the network providing proof, records and provenance services.

 

The market capitalization of NUM ranks №763 among all the crypto assets. The recent price moving of NUM is as shown below,

 

Price moving of NUM(Image Source: CoinMarketCap)

 

Exchanges and swaps now NUM has been listed on include Kucoin, gate.io, Huobi, PancakeSwap, Uniswap and Mexc. It is interesting that NUM is not listed on Binance even though Binance is the major investor of NUM project.

 

The mechanism of network

How does the decentralized network of Numbers Protocol work? In terms of participants, there are three on Numbers network, asset owners, asset retrievers and network operators.

 

Creators or asset owners upload their photos to Numbers Protocol. They need to pay some NUMs for registering their works on Numbers net. Network operators play a lot of different roles. Once creators upload or update their photos, some network operators need to verify the integrity of photos through some external trust in case of stealing someones’ photos. Some other network operators play the role of storage providers. They stored the photos into IPFS in case of retrieving in the future.

 

Asset retrievers retrieve photos from the network. Retrievers need to pay to collect or to get license for digital photo assets. A partial of retrievers’ payment will be used to reward network operators and the rest will be payed to asset owners.

 

Net Mechanism of Numbers Protocol (Image Source: Numbers Protocol)

 

Four main technologies are used for achieving Numbers’ decentralized photo network.

 

— IPFS for storage

Some net operators provide permanent storage and accessibility for photo assets through IPFS. The storage space provided by net operators is also called a part of data library.

 

— Blockchain ledger technologies

Verifiers on blockchain are also a kind of network operators. They check the integrity and external authenticity of photos. All of their working results will be stored on the distributed ledgers of blockchain. Ledgers on blockchain are another constitution of data library.

 

— NFT

Every photo will be minted as a NFT to record its ownership. Once photos are transferred to new owners, they need to be minted as a new NFT for recording the ownership change.

 

— C2PA

When photos are not created by the Numbers network tools, network operators can retrieve the provenance through interactions with C2PA services. In such a case, photos need to be C2PA-compliant when creating.

 

 

 

 

Token Allocation

 

NUM Allocation(Image Source: Numbers Protocol)

 

Early stage investors, technical, business and marketing partners, the network ambassador are classified into private sale pool. These participants own 17.5% of the total token supply.

 

Public sale refers to the participants in the community round of token sale. These participants pooled 3.2% of the total token supply.

 

Team helps build Numbers Protocol, advisors and developers who help build initial version of Numbers network are classified into Team & Advisors. Team & Advisors are rewarded 17.5% of the total supply.

 

Pre-listing partners and consultants are contributors during the listing process. Pre-listing partners and consultants are rewarded 1.5% of the total NUM supply.

 

27% of Tokens are reserved for staking rewards after network launch.

 

A liquidity pool (10%)of NUM is created for market making .

 

22.8% of tokens are reserved for ecosystem improvement. Network operators and community developers may be awarded from this token pool. Distribution of ecosystem rewards is finally decided by the network community.

 

Marketing tokens(0.5%) are used to incentive KOLs for broadcasting this project.

 

Token Inflation

 

Token unlock schedule of NUM(Image Source: Numbers Protocol)

 

Roadmap

Milestones Achieved of NUM program(Image Source: Numbers Official Website)

 

Seal API is a tool for advanced users to create, register, and retrieve photo assets directly through some call programs. Version 1 of Seal API was released in November 2020. Till December 2021, access to Seal API had reached 2.4 million.

 

As for ordinary users, they can use Capture App to create their photo assets and ensure their ownership. Capture App is actually the front- end application of Numbers blockchain. The built-in camera and photo assets wallet of it are convenient for users to access. Capture App was launched in February 2021.

 

NUM token launched formally in November of last year. For this year 2022, daily users of Capture App were beyond 10k on March. On February, NFTs on Numbers blockchain had been more than 20 million, and had been listed on more than 15 NFT marketplaces.

 

Analysis

A decentralized photo network is an attractive idea. Assuming that every hot application in Web 2.0 times like Youtube, Facebook, Instagram and so on need to be replaced by a similar decentralized application in Web 3.0 times. For example, Brave is more ideal browser than Chrome for Web 3.0 times considering its privacy, unlimited extension support and ads blocking. Similarly, Odysee seems more like Web 3.0 tube than Youtube and Mastodon may one day takes the place of Twitter. Also, it is reasonable to believe that we need a decentralized photo network in the future to replace photography communities like 500px.com. In a traditional photography community, infringement and centralized content auditing are unavoidable. While in a decentralized photo network, all photos are traceable, infringement resistance, tamper resistance , decentralized audit and immutable. For cameramen who uploaded their photos to such a network, there are always guaranteed rewards for every use.

 

The Numbers protocol tries to be a daredevil for such a Web 3.0 use case. It constructs a decentralized medium network which integrates blockchain, photography and authentication into its system. For now, it seems that the Numbers protocol has achieved some inspiring results.

 

In addition to the preferable program vision, founders of the Numbers protocol have artificial intelligence background. CEO, Tammy Yang is Particle Physics PhD of Manchester University, who is good at machine learning and deep learning. CTO，Bofu Chen is a famous open-source developer in Taiwan and experienced in artificial intelligence and IOT. For a Web 3.0 infrastructure which may face a ton of automation and intellectualization needs in the future, good mind and deep AI knowledge of founders may be a plus.

 

As for investors, we found that Binance, co-founder of Youtube called Steve Chen, co-founder of Twitch called Kevin Lin , DAO Maker and Protocol Labs of Filecoin are early-stage investors.

 

Risks

Inappropriate content

Because of that the lack of centralized content audit, it is inevitable that some creators will public inappropriate content on network.

 

Although mechanism of trust and credit verification on creators has existed on Numbers Protocol, comparing to a probable large number of perpetrators, additional measures are still necessary.

 

Fortunately, the team of Numbers Protocol owns a deep AI background, maybe they can try to utilize Computer Vision technology to identify inappropriate photos more efficiently in the further development.

 

Business risk

For traditional photography community, visits are very huge.Taking 500px.com for example, monthly visits of it are 5.3 million on July this year according to the data provided by similarweb. Comparatively, daily unique users of Capture APP are above 10K on March 2022. Obviously, Numbers protocol still need to put more effort into promotion and marketing. They need to attract more creators to be settled in their community. More creators means more high-quality content. In terms of content platform, only sufficient high-quality content can boost its development. Additionally, high stability and high transmission performance are required for Numbers network because of that high-definition photos are relatively large files. Thus, it is reasonable that daily maintain cost of Numbers network is a considerable figure. Conclusively, although decentralized photo network must be the future of photography community in Web 3.0 times, Numbers may lose their first-mover advantage in this competing field without considerable business success to cover their cost.

 

(Authored on August 29, 2022)

 

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