Node infrastructure is a service provider layer for businesses that hold and operate cryptocurrencies assets. The platform-as-a-service provides customers a rich interface to interact with nodes in various crypto networks.
The investment opportunity here should consider:
- The quality of the full node and feature set provided: This is the driving factor for customer acquisition. Areas a prospective customer may evaluate include: supported protocols, availability, security and observability.
- The ability to multiply revenue generation opportunities from the acquired customers. Areas to consider include staking, DeFi activities to generate yield, etc.
Enterprise-Grade Full Node Capacity
- Supported protocols and latest upgrades: In the future multi-chain world, the velocity to support new networks and the ability to scale to new assets that are “early” can accelerate customer acquisition.
- Blockdaemon around 25 protocols via an unified API
- Alchemy is heavily invested in Ethereum and its layer 2 network supports (Arbitrum, Optimism, Polygon). For institutional clients, the ability to access layer 2 protocols can be extremely attractive since it helps fee saving.
- QuickNode: Supports 11 protocols with some Layer 2s. A differentiating feature is the unified searchable NFT API that is indexed across different NFT smart contracts.
- Developer Experience: The ability to integrate with the client’s platform via HTTP, web socket, SDKs in supported languages can be critical for customer to onboard to a node provider and evolve with its architecture.
- For some protocols Blockdaemon offers are provided with SDKs in many languages and some of them have JSON-RPC.
- The experience in Alchemy feels more seamless with the Web Playground and SDKs, with dedicated Ethereum support to explore contract calls and execution steps with more granularity .
- Availability and scalability: Having a sounding strategy with diverse environments (data centers, cloud) can quickly win customer trust. The configurable node with horizontal scaling can serve more concurrent requests.
- QuickNode is available in 8+ regions.
- Blockdaemon is located across 70 data centers.
- Alchemy shared details on its scalable infrastructure to achieve this:
- Security: Connecting to a node provider poses firm risks for institutional clients since it transmits transaction data. Customers care about the ability to upgrade nodes to the latest version on time.
- Observability: Providing insights and analytics on node traffic with reliable tooling.
- Both Blockdaemon and Alchemy built an extensive dashboard, reaching feature parity.
Revenue Generating Features
- While Blockdaemon’s main line of business is a node provider, it also offers staking service for additional return. This product line may be worth a parallel analysis with validator-as-a-service competitors such as stakefish (See more in notes).
- Area to consider: easiness to integrate, attractiveness of staking revenue.
- Would a customer choose a packaged solution for node and staking service or would choose the best-of-class from other staking providers?
- Would custody service provider also be considered as part of service layer (provided in a form of marketplace)?