We propose two GIPs that bring indexing agreements on-chain and fund them from protocol issuance: GIP-0087: On-Chain Indexing Agreements and GIP-0088: Issuance Allocator Deployment and Configuration.
Why this matters:
Indexing rewards distribute protocol issuance based on curation signal — consumers can curate on subgraphs to attract indexers, but the amount of signal required and the indexing response it will produce are unpredictable. The coarse matching of supply to demand through curation creates inefficiency for both indexers and consumers. GIP-0070: Evolving The Graph Protocol Economics (2024) identified this incentive alignment gap and proposed migrating issuance toward mechanisms that link rewards to consumer value delivered.
Indexing agreements address this by letting payers directly fund the indexing they need at market-determined prices — indexers advertise their prices, payers select indexers and offer terms, and the market adjusts through this competitive process. By funding indexing through on-chain agreements — where indexers are paid for work verified by POIs — the protocol better aligns use of issuance with delivering consumer value. Indexers earn agreement-based income on top of existing rewards, and the protocol gains a mechanism to direct issuance toward specific indexing needs.
At this stage, agreement-based payments complement indexing rewards rather than replacing them. The total issuance rate stays the same; a small portion (~5% initially) is redirected from the Rewards Manager to fund indexing agreements. Indexing rewards continue to maintain the network’s economic security and incentivize broad participation, while agreement-based payments introduce a market mechanism for finding the cost and value of indexing work. Over time, as the agreement model matures, the balance between these mechanisms can shift based on what best serves the network.
Background
GIP-0081: A New Proposal for Indexing Payments proposed a mechanism for payers to incentivize indexers to serve specific subgraphs through signed agreements. The proposed mechanism uses off-chain signatures and payment vouchers, which requires trust in both directions: indexers trust that gateways will pay, and gateways trust that indexers report honestly.
These GIPs move that system on-chain, with on-chain agreement approval and protocol-funded escrow.
GIP-0087: On-Chain Indexing Agreements
Implements the GIP-0081 indexing payments model on-chain, providing a contract-managed alternative to the off-chain signature-based mechanism.
- On-chain lifecycle: Payers create offers specifying subgraph deployment, payment terms, and duration; indexers accept through the Subgraph Service; payment is collected periodically by presenting POIs.
- Contract-based authorization: Agreement acceptance is verified by contract call-back, removing the need for signing an agreement off-chain.
- Automated escrow funding: A new Recurring Agreement Manager receives minted GRT from the Issuance Allocator (GIP-0076: Issuance Allocator contract to split issuance across distribution targets) and automatically maintains escrow balances across agreements.
Moving agreements on-chain improves:
- Trust: Indexers are guaranteed payment through escrowed funds; payers are protected by POI-based verification. The on-chain mechanism provides greater transparency and predictability for escrow maintenance than off-chain coordination.
- Robustness: Escrow is managed by contracts rather than off-chain coordination, removing reliance on off-chain processing to keep the system operating.
- Capital efficiency: The predictability and immediacy of on-chain settlement reduces the need for escrow over-allocation, improving capital efficiency for payers.
- Transparency: Agreement status from offer to cancellation, escrow management, and funding flows are all visible on-chain.
For details: GIP-0087: On-Chain Indexing Agreements
GIP-0088: Issuance Allocator Deployment and Configuration
Deploys the Issuance Allocator (GIP-0076: Issuance Allocator contract to split issuance across distribution targets) and configures issuance splitting between the Rewards Manager and the Recurring Agreement Manager.
The deployment proceeds in three phases:
1. Deploy: The allocator is deployed replicating the current issuance rate, with 100% going to the Rewards Manager. No change for indexers or delegators.
2. Connect: The Rewards Manager is configured to source its issuance rate from the allocator. Still no change in issuance behaviour.
3. Split: Governance allocates 6 GRT per block (~5% of issuance) to fund indexing agreements. The Rewards Manager allocation decreases to match (from 120.73 to 114.73 GRT per block). Total issuance per block is unchanged.
The initial 5% allocation is expected to cover early migration of indexing off the upgrade indexer and instead utilising the network. Based on current forecasts, this could increase to ~10% as agreement volume grows. The fixed allocation is a starting point; the intent is to move to a self-balancing mechanism that adjusts to demand without ongoing governance intervention.
For details: GIP-0088: Issuance Allocator Deployment and Indexing Payments Configuration
Related Work
These GIPs depend on GIP-0086: Rewards Manager and Subgraph Service upgrade that adds the integration points for the issuance allocator and agreement system.
GIP-0079: Indexer Rewards Eligibility Oracle is also being rolled out alongside these changes, linking rewards eligibility to quality of service. Together, these proposals enable the protocol to directly fund indexing while ensuring rewards flow to indexers who are actively serving consumers.