he Future of Web3 Data: An Insight from Subsquid CFO & Co-Founder Marcel Fohrmann

 the Co-Founder and CFO of Subsquid, a decentralized data lake and query engine in Web3, aiming to make canonical blockchain data more accessible and affordable for developers.


Our conversation delved into the intricacies of the Web3 landscape, the pressing issues facing the industry, and how decentralized solutions can provide better access to blockchain data.

Welcome Marcel. Thanks for joining me. Let’s kick this off with your views on how 2023 went and 2024 will go.

Thanks for having me.

2023 was better than most people think. We started on a somber note. Series of upsets, negative events, and regulatory onslaught. Markets bled often, and it felt like winter overall.

But some of Web3’s most groundbreaking innovations happened in 2023. Projects with long-term vision were hard at work while the noise was low.

Take Layer-2 protocols for example. Optimism, Metis, Base, etc., took giant strides towards faster, cheaper, and more secure blockchain transactions. They latched on to developments in Multi-Party Computation (MPC), Zero-Knowledge Proofs, and other such privacy/security-enhancing solutions.

Even L1s like Solana achieved significant growth, with over 2500 developers building on the network and DEX trading volumes surpassing Ethereum. This improved Web3’s diversification and fostered healthy competition.

Likewise, we launched Subsquid to make blockchain data more affordable and efficient for developers. The point is 2023 was about improving and expanding the core infrastructure.

Scalability, interoperability, security, and a better user experience were the main focus areas. While also improving profitability and sustainability for businesses and for-profit projects.

It’s a win-win situation in the making. This will continue and grow in 2024. I’m super bullish about that. We have positive figures and data to show the progress from 2023. Now, it’s about honing in on what’s working and doing it better going forward. We’re at it already.

To set realistic expectations, what are the biggest challenges for Web3 right now? In general and, of course, in your sector.
Security is one of the main challenges. Hackers are becoming smarter and more driven by the day. With so much money at stake, that’s pretty obvious.

Web3 needs stronger security mechanisms that align with the principles of decentralization, autonomy, and privacy. Building them is a tough task, but we’re getting there fast.

Decentralized, real-time threat monitoring and mitigation systems are already functional and effective. It’s about raising collective security awareness and making best practices the norm.

Cost and scalability are the other main obstacles. They have been for many years now. And though most people don’t see it this way, these are essentially data availability and retrieval problems. Let me explain.

Any blockchain-based app or platform must retrieve on-chain data. Be it for updating wallet balances or the latest level of in-game avatars. How fast and cheap you do this determines your solution’s scalability and cost-effectiveness.

But Web3 developers have to rely heavily on RPC endpoints with severe rate limitations. This skyrockets data retrieval costs. It also hurts the performance and slows networks down. Especially when there’s high traffic—i.e., low scalability and bad UX.

Building a decentralized data retrieval system for fast, responsive, and secure blockchain-based actions became a necessity. We filled that gap.

Tell us a bit more about how you’re solving these problems and what that could mean for Web3’s future.

Sure. We enable Web3 developers to access canonical blockchain data at 90% less costs compared to RPCs.

In Web2, centralized data lakes like BigQuery, Snowflake, and others store and provide access to archival application data at scale. Subsquid is a decentralized, community-driven version of this critical system.

It aggregates and filters Web3 app data, making it easily extractable at scale. Without forcing developers to go through complex query processes and whatnot.

But while this decentralized data lake takes inspiration from its centralized counterparts, it’s not a replica. It supports infinite horizontal scalability, permissionless data access, credible neutrality, trust-minimized queries, and low maintenance costs. I won’t go into the details here. Anyone who’s interested can read our white paper at subsquid.io.

Coming to the impact on Web3’s future. Even with simple, localized queries, Subsquid’s model provides a novel primitive for on-chain data availability. It eliminates the need to maintain expensive archival nodes for historical data access.

Unrestricted access to archival data enables developers to build data-intensive blockchain applications at scale. This opens the path for highly complex solutions with deep functionalities that are feasible for providers to maintain and seamless for end-users. That’s the balance we need for Web3’s adoption.

Maximalism is all the rage in Web3. But you’ve been vocal about multi-chain systems. Please tell us why they’re important.

Bitcoin is among the best tech inventions in mankind’s history. It introduced the stable, functional form of blockchain, which has since enabled such cutting-edge innovations. But with Ethereum revolutionizing general-purpose computing, we’ve come a long way from Bitcoin’s single-chain, single-utility paradigm.

The multi-chain landscape is the best way to utilize blockchain’s full potential. It’s not merely about the store of value or payment anymore. DeFi, RWAs, DeSoc, DePIN, GameFi—so many possibilities have emerged, and ignoring them for maximalism is shooting yourself in the foot.

From a data access perspective, multi-chain systems help break silos and solve data fragmentation. They allow developers to access the entire data pool easily. Better interoperability, scalability, and innovation, and you can build more robust dApps this way.

Thanks for the insight. So, you’ve been doing great work with Subsquid. What’s next on this journey?

It’s more important than great. Strengthening Web3’s core infrastructure is a must, and that’s what we’re working to achieve.

The next big thing for us is launching support for Solana. Ethereum maxis won’t agree, but Solana is one of the most resilient and high-performance Alt-L1s right now. It also proved that L2s aren’t the only viable scalability solution available.

With a Nakamoto Coefficient of 22, Solana has a solid validator distribution while optimizing for latency and throughput.

Growth is another reason why we’re excited about Solana. We’ve seen how it bounced back from the ashes after the Alameda crisis last year to become one of the top five chains by market cap.

Above all, though, we’re rooting for Solana’s tech stack. Its innovative token standard supports fast, inexpensive, and confidential transactions—great for balancing privacy and UX. Compressed NFTs are exciting as well, and the potential launch of new clients will make the ecosystem more decentralized.

Finally, as a progressive project, Subsquid is always at the cutting-edge of innovation. Solana is set to become the hub for futuristic developments, from DePIN to DeSoc. We’ll provide the infrastructure to make that happen—it’s good for all.

Before the wrap, what’s your advice to newcomers who might be entering Web3 now that markets are rising again?

Learn to filter the noise. Focus on signals. The sooner you achieve this, the smoother your Web3 journey will be. There’s so much to do, it’s overwhelming. Set your priorities, and they’ll guide you better than anything else.

I’d also ask developers and project owners to build core solutions, optimized for experience and utility. Hype won’t get you far unless you deliver real, long-term value. No one’s a fool anymore, so don’t take things for granted. The future is yours to build.