API3 (API3)

Data Connectivity and Decentralized Oracles

API3 connects real-world data providers directly to blockchains through first-party oracles called Airnodes. This removes middlemen, making data feeds more transparent, secure, and cost-effective for decentralized applications (dApps).

Enabling Decentralized Applications (dApps)

API3 tokens are used to pay for subscription fees on dApps and grant access to Airnodes, which supply the APIs developers need. This helps dApps get reliable, tamper-resistant external data essential for their operation.

Governance and Token Utility

The API3 token governs the API3 DAO, allowing holders to submit proposals and influence the protocol’s development and direction. Staking API3 tokens can increase returns and reduce circulating supply through token burns, supporting the ecosystem’s growth.

Business Model and Oracle Extractable Value (OEV)

API3 has mechanisms to recapture Oracle Extractable Value, ensuring that dApps benefit from the value generated by oracle data usage, creating a sustainable business model for API3 and its users.

Advantages

• API3 provides first-party oracles that connect real-world data directly to smart contracts, eliminating intermediaries for better transparency and security.
• It enables API providers to run their own oracles, making data delivery simpler, more secure, and cheaper.
• The project supports decentralized APIs (dAPIs), which are valuable as more decentralized finance (DeFi) applications integrate them.
• API3 is governed by a decentralized autonomous organization (DAO), giving token holders governance rights and staking rewards.
• It has a strong community and is positioned as a potential competitor to Chainlink, addressing some of Chainlink's limitations.
• API3's solution is blockchain agnostic but best suited for Ethereum, which is a secure and widely used smart contract platform.
• The token can be used for governance, staking, subscribing to data, and accessing data insurance.
• API3 has potential use cases in sectors relying on real-time data, such as DeFi, enabling smart contracts to execute trades based on accurate market information.

Disadvantages

• API3 is currently best suited for Ethereum, so oracles specific to other blockchains (like Polkadot) may outperform it on those platforms.
• The project is sensitive to overall crypto market volatility, which can affect its price.
• The market for API3 is relatively small, so large holders ("whales") can significantly influence its price.
• It is a long-term project with token vesting schedules, which may affect liquidity.
• Some users question how common it is for decentralized applications (dApps) to use multiple oracles, which could impact API3's adoption.
• API3 is still early in development, so its full potential and ability to replace existing oracle solutions are yet to be proven.

Founders of API3

The founders of API3 are Heikki Vänttinen, Burak Benligiray, and Saša Milić. Heikki Vänttinen has a background as founder and CEO of CLC Group, a blockchain lab focused on smart contract solutions. Burak Benligiray was previously CTO at ChainAPI and contributed to the integration platform for API3. Saša Milić has experience as a system and network engineer and is also a co-founder of the project.

Major Investors

API3 has 17 to 30 investors depending on the source, including institutional investors such as Placeholder, Accomplice, Pantera Capital, Caladan, DWF Options, Laser Digital, Marshland Capital, MCE Group, Solidity Ventures, Equilibrium, Rarestone Capital, Block0, Matterblock, and The Spartan Group. DWF Labs is noted as a lead investor.

Funding Rounds

API3 has raised approximately $7 million over multiple rounds, including a seed round of $3 million and a public token sale. The seed round involved six major funds and included a 2-year token lockup for investors.

Investment Details

• Seed investors received 10 million API3 tokens, representing 10% of the total supply.
• Public sale tokens were increased from 15% to 20% of total supply.
• Tokens sold to seed investors vest linearly over two years.

Summary

API3's investors are a mix of venture capital funds and institutional investors focused on blockchain and crypto technologies, with DWF Labs as a lead investor and other notable funds participating in seed and subsequent rounds.

API3 Halal Status

Yes, API3 is considered halal according to Shariah analysis available on Sharlife (https://sharlife.my/crypto-shariah/crypto/api3). This indicates that it meets the criteria for being permissible under Islamic law.

Reason

The halal status is based on Shariah compliance checks that evaluate the nature of the project and its activities, confirming it does not involve prohibited elements such as interest (riba), gambling, or other haram activities.