CARV Research Report

Context

The advent of the Internet has heralded a massive surge in the generation of personal data, with over 90% of the world's data produced in the last two years alone and that data has powered global economic turn in return. Today's figures amount to 328 Million Terabytes of newly generated daily data, roughly 146GB per single user, with the trend showing continuous growth at exponential pace.

The need for data is expanding across diverse sectors at the same exponential pace, yet data consumers are encountering growing difficulties in accessing and curating valuable datasets, as these become increasingly centralized in the hands of a few major players, storing it on private servers, often without clear information on security, usage, or beneficiary details.

The repercussions of this system are profound, with personal data frequently being utilized without the consent of its owners. This not only excludes individuals from the value creation and monetization of their own data but has also led to more than 100 million data breaches in 2022 alone.

Now, more than ever, users need to be able to own, control, and benefit from the commercialization of their data.

Blockchain and Zero-Knowledge (ZK) technologies emerge as promising solutions in response to these challenges, offering new ways to address privacy issues through advanced cryptography and mitigate centralization risks with their inherently decentralized networks, promoting rights of ownership and transparency.

In this context CARV steps in, solving the $150B problem of targeted user acquisition in gaming & ad-tech, building the largest decentralized modular data layer servicing both web2/3 gamers, and the AI and gaming industries.

For data consumers in the gaming ecosystem; such as gaming studios, publishers, and AI companies, CARV Protocol offers access to the deepest, most accurate, privacy-preserving, and compliant database tracking user behavior in gaming-related environments.

At the same time, CARV Play allows gamers to selectively share and monetize their usage data generated by playing their favorite web2 and web3 games, shifting the focus from Play-to-Earn to Play-and-Earn: Rather than forcing players to play games they don’t like, users can play the titles they love while sharing information and data value as they continue engaging with games and brands, after ID binding.

On a daily basis, an average of 500K+ active wallets are frictionlessly engaging in such earnings activities, of which more than 30K web2 users, logged in via Steam to mint their soul-bound identities to start earning.

Additionally, CARV Play is leveraging its data layer and user access to rapidly build an edge as game publishers

Project Overview

The CARV Protocol is a modular data layer that facilitates data exchange and value distribution across gaming, AI and ∞. It encompasses end-to-end data flow processes, including data verification, identity authentication, storage, processing, model training, and value distribution.

The CARV Protocol empowers users by granting them control over their own data, enabling them to share information securely and privately, while also participating in revenue generated from their data usage.

For businesses, it provides access to high-quality, privacy-preserving and regulatory-compliant user data, leveraging this information to enhance their operations.

Infrastructure-wise, the CARV Protocol underpins the entire data lifecycle, ensuring that data monetization and value distribution are executed in a decentralized, integrated, privacy-focused, and regulatory-compliant manner.

The protocol, moving toward becoming a chain by 2025, primarily targets the gaming and AI verticals, showcasing its specialized capabilities. However, it is designed with the flexibility to extend its application to additional industries in the future.

The CARV Protocol

The CARV Protocol features a modular design that is interoperable with different blockchains, storage solutions, and data applications. The Components managing the end-to-end data lifecycle across various layers can be seamlessly integrated:

1. Identity Layer: This layer authenticates users via both traditional (web2) and blockchain (web3) mechanisms, aggregated under the CARV ID(ERC-7231). It integrates identities and data through CARV Link, Oracle, and other data verification services.
2. Storage Layer: A flexible data storage system, organizing data across different levels based on cost considerations and duration of persistence.
3. Computation & Training Layer: Utilizes a Trusted Execution Environment (TEE) cluster to process data and train AI models confidentially, with outcomes and TEE attestation relayed to the execution layer.
4. Execution Layer: Established on a consensus foundation, it interprets data consumers’ needs and allocates rewards according to the results of processing and verification activities.
5. Verification Layer: This layer consists of verifiers from the community, tasked with validating the TEE attestation to confirm its secure and accurate operation within the TEE.

The described components integrating CARV’s infrastructure are displayed in the following figure:

Traction

Validated Supply:

• 2.5M+ registered users, 900K CARV ID (ERC7231) unique holders on-chain, 1.2M+ MAU.
• 500K+ active community members and personal data contributors.
• 750+ games & AI companies integrated into the CARV ecosystem.
• Global leading AI & large cloud providers as investors & data infrastructure collaborators (under NDA).
• Best web3 games integrated, including Shrapnel, Illuvium, Off The Grid, Pixelmon, and more, onboarded 30%+ of all web3 games

Validated Demand:

• 5.7M+ on-chain attestations, produced every time CARV’s data is demanded on-chain
• Top 3 applications globally with 500K+ avg. Daily UAW according to DAPP Radar:
• Ronin 400K Daily UAW, Ranking #2
• Zksync 90K Daily UAW, Ranking #1
• Linea 50K Daily UAW, Ranking #1
• opBNB 320K Daily UAW, Ranking #3
• $1M Monthly Recurring Revenue, with a pipeline on track for $30M ARR (2.5x).

Investors

$20M raised from Global Tier 1 VCs and leading gaming players:

Temasek Holdings’s Vertex Ventures, HashKey Capital, ConsenSys, Tribe Capital, IOSG, OKX Ventures, Draper Dragon, No Limit Holdings, Infinity Ventures Crypto (IVC), Fenbushi Capital, Arweave and many more.

Partners

• CARV Play x Ronin Wallet
• CARV x ZkSync
• CARV x Linea

Technical Insights

In this section technical characteristics and main features for each protocol component are explored.

Identity Layer - CARV IDs & Accounts

CARV IDs serve as the self-sovereign identity layer of the protocol, merging web2 and blockchain-based identities through CARV’s innovative ERC 7231 NFT standard. This enables users to create a single, flexible identity that encompasses:

• Credential showcasing: Users can validate and showcase ownership, behaviors, social connections, and past experiences through credentials that serve as tangible evidence.
• Integration capabilities: By integrating CARV ID, applications can access user data with consent, enhancing their products with interoperability.

Alongside IDs, CARV Accounts streamline the onboarding of new users into web3 using Account Abstraction to allow automated wallet creation and social logins, gas-less transactions across multiple blockchains, full user control over assets with non-custodial wallets, and ultimately provide enhanced security and interoperability across all platforms.

The Generative Archive Token (GAT) on CARV Play is designed specifically for mid to hardcore gamers from the Web2 space. Each GAT is unique, capturing individual game memories, achievements, skills, and journeys, and is soul-bound and verifiable to its owner. Since its introduction, over 30,000 users without prior Web3 wallets have used their Steam accounts to mint this soul-bound Token to collect and display their GAT achievements.

Identity Layer - CARV Link

CARV Link acts as a decentralized oracle service that bridges the gap between blockchains and external data sources, services, and systems. It enables the retrieval and verification of data, both on-chain and off-chain, facilitating interoperability.

Storage Layer - CARV DB

After being authenticated and approved by the Identity Layer, the data will be aggregated and only visible to the end users.  They have the option to encrypt this data and store it wherever they prefer. The availability and cost of data storage influence the variety of solutions offered:

Modular data storage - CARV DB

CARV DB constitutes the storage component of the protocol, developed on top of EigenLayer. Utilizing AVS (Actively Validated Services), to not just store data but also to verify its authenticity. Data storage is stratified into tiers, balancing between cost and reliability, from the most economical option, offering lesser consensus and persistence, to the more robust solution, which, while costlier, provides greater data reliability and consensus.

Computation Layer - TEE Cluster

Computation is built on top of the Trusted Execution Environment (TEE) (e.g. Intel SGX). It ensures that user data is processed in privacy-enhancing technologies.

TEE nodes process users’ data and produce TEE attestations, which can be authenticated by the verification layer to make sure the execution results posted on-chain were indeed correctly processed within the same trusted environment to which users submitted their data.

Verification Layer - Verifier Nodes

The decentralized and privacy-centric operation of the CARV protocol necessitates community involvement in the verification process. This is achieved through verifier nodes, managed by the community, that oversee the end-to-end data process and verify the TEE attestation result.

While anyone has the capability to operate verifier nodes to ensure data is processed in a secure environment, only verifiers holding an NFT license have the authority to reach consensus on TEE attestations and penalize any misbehaving TEE nodes.

Execution Layer

This layer operates within a multi-chain framework, dedicated to managing the distribution of value across the different protocol's components. It leverages smart contracts implemented on various consensus layers, including both Layer 1 and Layer 2 networks. The Execution Layer's primary functions include recording TEE attestations and verifier reports on-chain, and, following verifier consensus, allocating on-chain rewards to data providers and infrastructure while levying charges on data consumers. This structure ensures a decentralized, secure, and efficient process for managing transactions and interactions within the CARV ecosystem.

User Facing App - CARV Play

CARV Play is an AI-powered gaming super app built on top of the CARV Protocol, starting with social, credentialing, and publishing where over 2M users can share data, build credentials, discover and receive rewards for playing titles across a total of 750+ games

The First Cross-Platform Achievement System

In CARV Play gamers can aggregate their gaming accounts and convert achievements into verifiable Soul Bound Tokens (SBT), storing in-game achievements, memories, and journeys across all games and gaming platforms on the Blockchain.

CARV categorizes SBT badges into Achievement Badges, Event Badges, Membership Badges, and Generative Archive Tokens (GAT)

CARV hosts themed events and competitions on CARV Play, earning you potential rewards such as USDT, NFTs, CARV GEMs, and more!

GEMs on CARV Play are incentives that players can earn through various activities, such as participating in events, unlocking mystery boxes in CARV Pass, and more. They can be used to redeem rewards like in-game items, cash, and physical prizes from the CARV Shop.

The CARV Pass is a feature on CARV Play that allows players to earn GEMs and unlock rewards by completing quests. It introduces time-limited, weekly, monthly, and seasonal quests that players can engage in to collect EXP, level up, and earn rewards, including GEMs, mystery boxes, and more. Power levels, determined by activities such as leveling up the Pass, dictate the share of GEM rewards from the total prize pool.

CARV AI Agent - CARA

The AI Agent of CARV, known as CARA, is a chatbot developed on Telegram. You can interact with her via this link: (CARA on Telegram).

CARA is designed to assist users in exploring the CARV ecosystem and the broader cryptocurrency market. Officially launched on April 1, 2024, CARA is rapidly evolving, continually adding new functionalities that enhance user experience and provide more personalized interactions.

CARA is committed to providing users of CARV and the entire crypto world with a more intelligent and more intent-oriented Q&A experience, and in the near future, it can provide users with more personalized and customized data services, recommendation, and advertising services:

Based on the player's game data, CARV platform data and also web3 data, CARA will also recommend games, activities, projects, airdrops, etc.

Tokenomics

CARV Token Utility and Purpose

CARV is the native utility token of the CARV ecosystem, used as a medium of exchange within its platform. It empowers players with ownership of data and allows participation in the governance of the ecosystem's development.

• Retail users’ premium utillities in CARV ecosystem, e.g., gas payment for multi-chains, gaming assets purchases, etc.
• Incentive to bootstrap incentive layer, e.g., data owners, providers, consumers.
• Liquidity providers (including games, gamers, and delegators, e.g., KOLs, Guilds) can lock up CARV's native token, to vote for rewards pool dedication to games on exposure & UA efforts in the CARV ecosystem, which attracts real gamers (grinders). Vote-lock holders can boost their deposit APY further as well.
• CARV can be converted to veCARV with 1:1 ratio through staking

veCARV Token Utility and Purpose

veCARV stands for voting-escrow CARV, is a non-transferable token. veCARV is mainly used for:

• CARV Protocol governance.
• Incentive to bootstrap incentive layer, e.g., data owners, providers, consumers.
• Used for governance voting in P2E system 'Infinite Play'.
• Used in P2E systems to delegate voting rights to escrow pool owners and receive pool rewards.
• Incentivizes node operators who secure and support the network.
• veCARV can be redeemed for CARV with varying rates and waiting periods, which is explained in more detail in The Redemption Process

Convert CARV to veCARV

Convert CARV to veCARV at a 1:1 (100%) ratio at any time.

Tip: CARV is transferable. After conversion, veCARV will be non-transferable.

Redemption of veCARV into CARV

VeCARV conversion to CARV requires an unlocking period.

The redemption rate varies for different unlocking periods, with longer unlocking periods resulting in higher redemption rates, reaching up to 100%.

Users are required to pay a network channel fee of 1$ CARV each time they initiate a Redeem.

Users can cancel redemption requests at any time without being fined, including after the unlock period is over if the redemption has not been claimed. period is over if the redemption has not been claimed.

Once veCARV enters the redemption period, it will no longer be eligible to participate in governance voting.

After the redemption process of veCARV, the remaining (if any) veCARV will be distributed accordingly:

• 50% will be converted to CARV and enter the CARV treasury to maintain network operation.
• 50% will be burned upon claim of redemption, which makes CARV deflationary.

CARV Token distribution and vesting schedule

The total supply of $CARV will be 1,000,000,000 and will become accessible over four years, starting at the time of the Token Generation Event. The initial four-year post TGE allocation of the total supply of $CARV is as follows:

• Nodes & Community through various means to reward our community for their efforts in contributing to the project's success. - 50% (500,000,000 $CARV tokens)
• Ecosystem & Treasury - Treasury holding of $CARV tokens - 9% (90,000,000 $CARV tokens)
• Early Investors - seed and early strategic investors in CARV who are willing to company the project in the long run - 10% (100,000,000 $CARV tokens)
• Private Fundraising - series A and thereafter investors in CARV that participate in private fundraising - 10% (100,000,000 $CARV tokens)
• Founding Team & Advisors - rewarding the core founding contributors and advisors for their full-time effort to the project's success 17% (170,000,000 $CARV tokens)
• Liquidity - tokens allocated to provide liquidity - 4% (40,000,000 $CARV tokens)

To align incentives of all stakeholders, CARV token's ($CARV) vesting for all shareholders is indicated below:

Verifier Node Rewards

Verifier node operators will receive token rewards for their contributions to the network’s operation and security (data privacy protection).

Up to 25% of the total supply will be provided to verifier node operators. Emission adopts a release model of 25% reduction every 6 months.

It is expected a release of about 50% of tokens during the first year.

Redemption of veCARV into CARV

Roadmap

Phase 1: 1st Party Platform for Seed User Base, Data Assets Accumulation & Data Value POC

• CARV Play - Gaming credentialing, social, self-attesting & game distribution social network • Onboarding seed user base with quality data across web2 & web3 • Play – Data – Earn closed user loop
• CARV Portal – For Gamers to list games, set up credential-gated missions & rewards to target, acquire, and retain users on CARV Play and understand users beyond anonymous wallets across community & the game • Data insights generated on ownership, role behavior, social relation, experiences, attitudinal preference labels/tags used for attestation, user query & targeting, recommending, & analytics
• PMF: Users: 2.2M registered users, Currently integrated with 300+ web3 games, among with 180 are using UA, data analytics tools. Data assets (integration with 42 chains, 15+ social / gaming accounts, 170 user tags), $1.4M in revenue in the past 2 months from both games and gamers.

Phase 2: Open Protocol & Token Incentive for Algorithm, Data Contribution, and Data Consumption Democratization

• CARV Protocol – Self-sovereign identity oracle & incentivized data value exchange infrastructure • Token incentive for onboarding more data owners, data & algorithm providers, validators to enrich the data pipeline • ID OAuth SDKs open for projects’ integration with users' toggling personal data bringing over privacy protection & incentive • Alternative & opt-in data subscription by entities generating passive income for users • Query engine to output non-PII and sensitive info for digital marketing across Web2 & Web3
• PMF referring to LiveRamp

Phase 3: Scaled Distribution of Personalized & Incentivized Content on 1st Party & 3rd Party Publishers

• CARV Protocol • Recommendation Engine for serving relevant personalized/incentivized ads to generate higher conversion • Ads SDK to be open for publishers to integrate. Also CARV would launch 1st party content/publishers to integrate the SDK to extend digital marketing user reach • Incentive ads distributing generating higher conversion, more revenue for publisher and CARV • Incentivized ads increases new user base from publishers to CARV network participation
• PMF referring to AppLovin

Flywheel: achieved by user base, data base, data consumer (advertiser & publisher).

Competitive Landscape

In analyzing CARV's competitors, it's insightful to consider both Web2 and Web3 companies that are significant in terms of market cap, as well as those within the specific niche of Web3 that CARV operates.

Web2

• AppLovin: 14B market cap, 1B revenue. Similar in its data driven UA with (data + first party app + analytics) flywheel, starting with gaming
• TapTap: 1B market cap, 470M revenue. Similar in its community driven game discovery
• Liveramp: 7B market cap, 300M revenue. Similar in its creation of identity graph connecting all data points related to an individual

Web3

• Chainlink: 7B FDV, similar in oracle for on-chain, off-chain, inter-chain communication of data, for personal data.
• GALA: 2.1B Market Cap, similar on the application layer as a gaming platform
• Berachain: 5B in the latest private round. Similar to PoL and mechanism of token locked, delegating, voting with token rewards pool, but for games to enhance exposure & UA with grinders/gamers.
• Forge: noted as a competitor but is currently trailing behind in terms of innovation and market adoption.
• Clique: Initially meant to focus on offering MPC, TEE & ZKP based web2 and web3 digital IDs solutions, Clique has since pivoted its business model to act as a resource allocator for off-chain compute job requests, delegating tasks to selected data feeds and compute vendors.
• Masa: Although a contender, Masa's lack of vertical-specific data is a limitation. Without focusing on niche markets, such as CARV’s significant involvement in gaming which alone has generated $1M MRR, Masa may struggle with value creation and widespread adoption.

Team

Core Team

The CARV core team is comprised of highly skilled professionals with a cumulative experience spanning decades at leading companies in the technology, gaming, and finance sectors. Their collective background includes significant roles at major corporations such as Big Tech and prominent gaming companies, where they have successfully scaled products and platforms to millions of users, led significant tech innovations, and driven substantial business growth.

CEO*

Former Big Tech leader & crypto native founder, having grown gaming & entertainment products to 20M+ and multiple exits

• Led Contentos (Ticker: COS) & COS.tv to 50M users & 4M MAU
• Founder of D.Media (exit to Dlive), a decentralized creator platform
• Founding member LINO (exit to TRON). Scaled DLive to 20M MAU
• Ex-GM of Americas at Cheetah Mobile (NYSE:CMCM)
• BS in Mathematics from UCLA

Gaming & Growth*

8 years of game publishing & operations experience at EA, Tencent Games, and Garena for nearly 18+ global audience

• Publishing Producer at Electronic Arts, Ex-Operations Manager of 2 priority games for SEA, LATAM and MENA at Garena
• Tencent Games Publishing lead of Apex Legends Mobile, Senior Operations for Arena of Valor and FIFA Online 4.
• MS from London School of Econo London School of Economics

Ads & Data Infra*

• Tech Lead Manager of Data Mgmt Platform at TikTok for Business (Ads)
• Previously co-founder & CTO of Al-driven video interpretation startup, raised 15M USD in funding
• BS in Information Security & Cryptography, MS in Computer Science USC

Tech & Blockchain Architect*

Expert in confidential computation, blockchain, 6 years in crypto leadership roles

• Previous Blockchain Engineering Lead at LINO Network, built a DPoS blockchain & wallet/explorer, laying foundation for 20M MAU application
• Contributor to Cosmos SDK
• Led Staking & Key mgmt. as Staff Software Eng. at Coinbase
• Ex-software eng. at Google redesigning experiment frameworks
• MS CS at UCLA

Operation & Finance*

• Investor at IDG Capital and Medtronic-Sequoia Capital
• Consultant at McKinsey VC/PE Group in Silicon Valley / Shenzhen
• Ex-Director of BizOps at NYSE:MOGU, built AI-based eCommerce tool from 1-30
• MS Eng. JHU, Havard MBA dropout

Product*

10 years leading product in gaming, consumer, and crypto, multiple successful builds from 0-1 & 1-100

• Senior Game Designer at Tencent Games, game design / culturalization e.g., H1Z1, Paladin, Crossfire etc
• Product Director of Klook (Series D), led whole product matrix including App, Web and Mini Apps’
• Product Director of Xunlei Co., led content product design and innovation exploration
• MoEE of University Breemen, Germany

* The names of all Team members have been removed in respect of the Team’s privacy requests. Team members are doxxed with all relevant partners and listing counter-parties such as CEXs, all investors, and Impossible Finance itself.

Investment Thesis

CARV's innovative approach to data ownership; emphasizing privacy and ethical, high-quality data sourcing; presents a promising model for rewarding gamers and fulfilling the increasing data needs of businesses.

From this research article, it is worthwhile to highlight the following key points:

• CARV has found clear product-market fit:
• CARV’s value proposition for gamers allowing them to monetize their data in a privacy-preserving way is showing continuous growth, with currently over 2.5M registered users,  onboarding both web2 and web3 gamers.
• CARV’s value proposition for web3 games is extremely attractive, showing over 750 game integrations, as gaming studios are fiercely competing to acquire new users.
• Demand for CARV’s data is also verified, with over 5M+ attestations on-chain and 1M monthly revenue already achieved (with 30M ARR projected by EOY) serving game studios (both in web2 and web3), publishers (both in web2 and web3), and AI companies.
• CARV is the most used application (UAW) in Ronin and Linea blockchains.
• CARV core team is composed of multidisciplinary experts in key areas such as product development, gaming, finances, computer science and confidential computation.
• CARV is supported by Tier 1 VCs and leading gaming players.

Risk Evaluation

• Ability to continuously integrate Web 2 game publishing platforms like Steam
• Mitigation: Game distribution platforms like Steam are renowned to give out API keys to third-party service providers that help enhance player experience. Currently, there are no signs of Steam or other distributors wanting to limit API usage, but even if that was the case, CARV wouldn’t be limited to relying solely on Steam for the acquisition of the gaming titles to cater to the needs of its player base.
• Ability to continue on the growth trend of global market penetration
• Mitigation: CARV team has started expanding globally with both quality new hires and localized communities. The trend doesn’t show any sign of slowing down, with data consumers fetching data from XX countries.
• Latency Risk with scale: Typically the more decentralized a validator set, the higher the latency, especially with low hardware requirements.
• Mitigation: CARV randomly selects a sub-set of 100 nodes to complete every validation, this allows them to fix the latency to just a few seconds, striking a good balance for data consumers between efficiency and security.
• Smart-Contract Risk: Smart-Contract related risks are always inherent in web3 protocols.
• Mitigation: CARV’s smart contracts have been audited by X & Y. Bug-bounty programs will also be implemented to ensure continued monitoring.

Links

• Website
• App
• Carv Protal
• Docs
• FAQs
• Twitter
• Medium
• Discord

Features of CARV

• https://venturebeat.com/games/carv-raises-10m-to-build-out-modular-data-layer-for-gaming-and-ai/
• https://cryptonews.com/news/new-standard-enters-nft-arena-erc-7231.htm
• https://techcrunch.com/2022/11/22/carv-funding-40-million-valuation/
• https://www.pocketgamer.biz/news/83667/marblex-invests-in-carv-to-deliver-data-driven-web3-experiences/
• https://blockworks.co/news/traditional-gaming-web3-blockchain
• https://hackernoon.com/the-blockchain-gaming-evolution-from-play-to-earn-to-data-to-earn
• https://www.gamedeveloper.com/business/we-need-to-talk-about-gaming-s-user-acquisition-problem#close-modal
• https://crypto.news/whats-better-than-owning-your-assets-owning-your-data-opinion/
• https://www.youtube.com/watch?v=73pnLkGDjdU&ab_channel=CARV

About CARV

CARV is building the largest modular data layer for gaming and AI.

CARV's mission is to empower users with data self-sovereignty and to share value captured from the utility of the data in a consent-based, privacy-preserving mechanism with data consumers, to allow them to build the next generation of data-intensive tools, products, and AI models.

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About Impossible Finance

Impossible Finance is the go-to crypto investment platform that empowers you with high-quality, fair and accessible crypto opportunities. We simplify DeFi so you can enjoy fairer investing, cheaper trading and better yields through our accelerator, launchpad, and swap platform.

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