AR is the native currency of the Arweave network. The token is used to pay for distributed data storage and provides a crucial foundation for network security through incentivization.
A brief history
Headquartered in London, Arweave is a decentralized storage network founded by Sam Williams and William Jones in July 2017. The network’s mission is to store files permanently across a distributed network of computers- creating a digital archive that persists in perpetuity. With Arweave’s innovative blockweave protocol, data loss or manipulation on the internet can be eliminated. Like traditional blockchain networks, Arweave’s blockweave is made up of a collection of blocks. These blocks hold the data that makes the websites and applications. In a traditional blockchain, blocks are linked to the previous and following blocks in the chain only. Arweave’s blockweave architecture differs in that each block is linked to the following block and two previous blocks: one preceding block and a second block from the network’s blockweave history known as its “recall block.” The recall block is also key to Arweave’s consensus mechanism known as Proof of Access (PoA). Another main component in the Arweave network is the permaweb, a decentralized web built on top of the Arweave blockchain. This is where all of the Arweave DApps are stored.
AR in practice
AR is the native token of the Arweave blockchain and has multiple use cases within the ecosystem. First, all transaction fees on the Arweave network must be paid in AR. This includes the fees for storing and retrieving data, and for interacting with various DApps built on the network. Users who wish to store data on Arweave must pay for that storage in AR and the host of the data will always receive AR as payment. But interestingly, the payments are not made directly to each miner but are pooled in the Storage Endowment and distributed to the network over time. As the pool grows over time, it can pay miners in the future over a long period. It should also be added that storage on Arweave is a one-time payment, not a subscription-based approach.