As blockchain technology continues to evolve, the need for accessible and reliable data for developers, users, and organizations has become increasingly important. With this development, many find it challenging to navigate blockchain data and properly implement the correct tools, as it often requires a technical background and resources to make informed decisions. A project recognizing these challenges is Covalent Network, a modular data infrastructure for AI.
It provides a modular solution that aggregates and organizes data from various blockchain sources. With a vast repository containing over 100 billion rows of structured data across more than 100 blockchains, Covalent is well-equipped to support the development of decentralized applications and AI-driven projects.
This month’s review will look closely at Covalent, discussing its recent product developments, token economy, the founding team, fundraising, and future roadmap plans.
What Is Covalent: AI, API, and Data Analytics
Covalent Network is advancing the decentralization of its protocol, working towards a community-governed platform that aims for self-sufficiency. It functions as a multi-sided platform designed to index and store blockchain data across various points on the network, ensuring that users can access this information instantly via the GoldRush API (formerly known as the Unified API).
The Covalent Network has several crucial features:
- Compatibility with industry-standard data tools
- Multi-chain functionality
- Efficient storage and network usage
- Low resource requirements, allowing operation on commercial and retail infrastructures
At the heart of Covalent’s architecture is a focus on data verifiability, realized through cryptographic proofs. For each operation completed on the network, a corresponding proof is generated. This mechanism ensures that Network Operators maintain integrity and provide accurate data, distinguishing Covalent as one of the first data middleware protocols to implement such a proof-based system.
Covalent Powered Products
Covalent powers a range of products, such as:
- GoldRush API: This suite of data tools simplifies Web3 development across more than 200 blockchains. The GoldRush API provides structured on-chain data through robust software development kits (SDKs), application programming interfaces (APIs), user interface kits, decoders, and templates, streamlining the process for developers.
- Increment Data Analytics: Increment provides a comprehensive solution for querying and visualizing the complete historical dataset of over 100 blockchains, encompassing every smart contract, event, transaction, and block. Utilizing Covalent’s infrastructure, Increment introduces SQL-based analytics to the Web3 landscape, allowing users to extract valuable insights from blockchain data effectively.
Since its inception, Covalent has achieved significant milestones, including:
- Over 30 globally distributed professional operator sets
- More than 70,000 developers utilizing Covalent
- Full replication of over 100 blockchains including Ethereum, BNB Chain, Polygon, Avalanche, Arbitrum, Base, and others.
Covalent customers include companies such as EY, ConsenSys, THOR Wallet, Atomic Wallet, and more.
Recent Launches: AI Agent SDK
At the beginning of 2024, Covalent underwent a rebranding and implemented a series of strategic upgrades to enhance its AI capabilities and establish itself as the standard in data accessibility. Among the most notable of these advancements is the introduction of the AI Agent SDK—a comprehensive toolkit designed to empower developers to create intelligent, context-aware agents with remarkable ease and functionality.
The AI Agent SDK facilitates direct access to both on-chain and off-chain data, including private data, enabling developers to build more sophisticated applications. The AI Agent SDK addresses a critical gap in the market by providing built-in blockchain data access alongside seamless blockchain interactions. This robust, scalable solution is tailored to the evolving landscape of decentralized applications, consolidating all necessary functionalities into one powerful package.
Currently, traditional AI agent tools often lack integrated access to essential data, which can result in inefficiencies and heightened security risks. Covalent’s AI Agent SDK mitigates these challenges by inbuilt access to on-chain data, with plans to expand to off-chain and private data soon. This integration allows developers to create agents capable of:
- Interacting directly with smart contracts and blockchain protocols.
- Verify and execute transactions autonomously, eliminating the need for intermediaries.
- Accessing real-time and historical blockchain data, ensuring agents work with the most current information.
- Facilitating secure and transparent agent-to-agent interactions, thus paving the way for new classes of decentralized applications.
Through these recent advancements, Covalent is actively transforming how decentralized applications are developed and deployed, setting a new standard for data access in the blockchain landscape.
Token Economy
At the heart of the Covalent ecosystem lies the Covalent X Token (CXT), which plays a vital role in facilitating the network. CXT has processed over 22 billion paid API queries within a mere four months, contributing to a 15% month-over-month revenue growth. This traction positions Covalent to soon surpass $1 million in annual recurring protocol revenue, with prominent customers including Ondo Finance, THORChain, and members of Aave’s ecosystem.
The utility of the CXT token are categorized into two areas:
- Staking: To become a Network Operator, participants must first meet a minimum staking requirement. In exchange for their contributions—which include validating data requests, indexing blockchain data, and responding to queries—these operators receive compensation in CXT. Additionally, token holders who wish to support network security without engaging in node operations can delegate their tokens to a Network Operator, allowing them to earn staking rewards in CXT.
- Governance: CXT holders are empowered to participate in the governance of the network, using their tokens to vote on on-chain proposals submitted by the community. This feature ensures that those with a vested interest in Covalent have a voice in its development and governance.
Recently, Covalent announced a strategic partnership with OKX. This collaboration will enable high-yield CXT staking through the OKX platform. Furthermore, OKX has commenced operations as a Block Specimen Producer for the Ethereum Wayback Machine (EWM) infrastructure, marking a significant advancement in their decentralized operations.
Team
Covalent was co-founded by Ganesh Swami and Levi Au. The team possesses a diverse range of expertise, including finance, blockchain, data, and distributed systems. Currently, the team consists of 30 members, mostly all based in Vancouver, BC Canada.
Fundraising
Covalent has raised a total of $16 million across six funding rounds, with the most recent completed on June 26, 2024. Over the years, the company has been backed by prominent investors, including Binance, 1kx, Coinbase Ventures, Woodstock, Maelstrom, RockTree Capital, and Hashed.
What’s Next
Looking ahead to the first quarter of 2025, Covalent is poised to unveil significant advancements in its AI agent technology, further solidifying its position as a leading infrastructure solution in the blockchain space. The launch of the AI Agent SDK is just the beginning of a larger movement to empower developers and redefine the future of decentralized systems.
With over 22 billion paid API queries processed and accelerating adoption through marquee integrations, Covalent is building a sustainable ecosystem where CXT powers data-driven innovation. As 2025 unfolds, these advancements will cement Covalent as the backbone of scalable, intelligent, and decentralized solutions in AI.
