API3 connects decentralized applications with data and services provided by traditional Web apis to extend the applicability of blockchains without sacrificing the idea of decentralization. This will be achieved through dAPI (fully decentralized blockchain native API), which will be built, operated and implemented for profit by API3 DAO (a decentralized autonomous organization that allows all stakeholders to directly participate in project governance), all through API3 tokens, This token will be granted voting rights in the API3 DAO.

The API3 vision is that the ideal solution must provide quantifiable security assurance by drawing on the credibility of the API provider.

In the traditional predictor model, there are several problems: (1) data source providers do not get most of the rewards for data creation. In Chainlink's case, the top three node operators each received $100,000 per month in subsidies from August to October, while node operators typically paid data source providers between $100 and $400 per month. It's like when the manufacturer produces the product, most of the profits are taken by tmall sellers. (2) It is difficult to hold accountable. Because there is a layer of node operator between the oracle operator and the data source provider, it is difficult for both the oracle and the user to know who the data source provider is behind the problem when the data provided goes wrong and the smart contract users suffer huge losses. As a result, manipulating the price of the prophet to obtain huge profits has become a difficult thing to trace responsibility.

In API3, there is no intermediary, and the data provider can operate the node itself and reap revenue. This is a lot of good competition, no intermediary, direct from the manufacturer to the user. In order to achieve this function, API3 designs a core component, Airnode, which is similar to the API gateway. The API provider only needs to do some simple DNS configuration like setting up the API gateway in the cloud service provider to realize the purpose of providing data directly to the smart contract, and only needs one deployment. There is no need for any maintenance. Since data providers directly provide data for smart contracts, the vast majority of revenue generated by data will also be allocated to data providers, in line with the vision of the Value Internet. Of course, correspondingly, the data provider shall also assume the responsibility for the authenticity and validity of the data. With great responsibility comes great benefit.

API3 has four types of roles: 1. DAPPs: service consumer; 2. Stakers: Pledgers pledge API3 tokens to the pledging pool managed by API3, provide insurance money, and gain governance rights of API3 DAO and share of API subscription fees; 3. API3 DAO: Manage API source and pledge pool; 4. API provider: Provides API data for the API3 DAO

API3 coin is not only the governance token of API3 DAO, but also the pledge token of pledge pool. The usage scenarios of tokens are as follows: 1. The pledgee pledges API3 tokens to the pledge pool, provides insurance for the pledge pool, and obtains governance rights of API3 DAO (voting, initiating proposals, etc.); 2. API3 DAO selects high-quality service providers from numerous API providers into the aggregator; 3. DAPPs pay to subscribe to dAPI to obtain prophet data or services, and the pledgee gets a certain proportion of the subscription fee. 4. If there is a problem with API data (fake or otherwise), the API3 tokens pledged by the pledgee will be deducted to compensate for data errors and prevent the data provider from doing evil, similar to ethereum 2.0 authentication nodes.

1. Security: dAPIs do not rely on third-party prognosticators, which are an ongoing and significant risk factor for alternative solutions. In addition, dAPI insurance services provide their users with quantifiable and trust-free authorization security, further solidifying API3's position as the most secure solution for decentralized applications to receive API services. 2, robustness: Airnode uses serverless technology, strong ability to resist downtime. This is compatible with a node-free design and is not susceptible to errors or adverse network conditions. In addition, dAPIs will be managed by the DAO, which provides a powerful risk-mitigation framework by maintaining a self-regulating balance of risk and reward through carefully designed incentives. Go to 5.6. ("API3 token economy ") white paper. Cost-effectiveness: dAPIs cut out the middle man. They do not have to pay the middleman tax, which is paid to third-party prognosticators to encourage them not to attempt attacks. See section 3.2 (" middleman tax ") in the white paper. In addition, the data source generated by the first-party predictor does not require excessive redundancy at the predictor level -- this data source achieves the same level of decentralization with fewer predictors, resulting in significant Gas cost savings.

Airnode is a completely serverless predictor node designed for API providers to run their own predictor. It solves all the problems associated with Oracle nodes: 1. It does not require any specific operational knowledge. In fact, it's hard to even say an operation because Airnode is designed to be complete. 2. Due to existing fully managed serverless technology, it does not require any routine maintenance, such as updating the operating system or monitoring the uptime of the nodes. It is designed to be stateless, making it extremely resilient to any problem that could cause a permanent shutdown and require node operator intervention. 3. It is built on an on-demand pricing service, which means node operators only pay for the amount of nodes they use. This allows any API provider to run the predictor for free and only start paying once they start generating revenue. 4. It doesn't require node operators to handle cryptocurrencies at all. The protocol is designed in such a way that the requester bears all gas costs.

API3 issued a total of 100 million pieces, and the basic distribution is as follows: 25 million to the ecological fund; 10 million to partners and contributors; 30 million yuan will be allocated to the founding team, which will be locked up for 6 months and then unlocked linearly for 2 years; 20 million public offerings; 10 million to seed round financing; 5 million pre-seed round.

To decentralize dAPI and overall project governance, API3 will be governed by daOs. Governance will be fully decentralized and open, meaning that all equity holders will be able to participate directly in the governance of the project. This will be done through the API3 token, which will grant voting rights in the API3 DAO through the mechanism described in Section 5.6. The DAO will vote on advanced metrics that involve mechanisms such as rewards and mortgages. In addition, DAO will provide grants from DAO Bank to determine the overall direction of the project. More granular tasks will be performed through a hierarchical team structure to achieve scalable governance. API3 is designed to build, maintain, and monetize Dapis on a large scale. Its success in this regard can be estimated in terms of its total revenue, as this will increase with the number of Dapis and the amount of funding it receives. To align governance incentives with the success of API3, a portion of the revenue determined by the DAO will be distributed to the pledgor. As API3 becomes more widespread, it is expected that this mechanism will dominate aggressive pledge rewards.