Image credit: Freepik
As technology advances, we are standing at the intersection of digitalization and decentralization. The Decentralized Physical Infrastructure Network (DePIN) has emerged, which is based on blockchain technology and relies on individual hardware devices called nodes. These nodes range from personal computers to dedicated servers and Internet of Things (IoT) devices, forming a decentralized network without a centralized processing center or authority, thereby improving security and transparency.
DePIN technology is revolutionizing the way we think about cloud computing by building decentralized networks that outperform traditional centralized systems in terms of efficiency, security, and scalability. As AI-based applications such as ChatGPT become a global phenomenon, decentralized networks are critical in managing and advancing the way data is collected, used, and processed in AI innovation.
According to a CoinDesk report in April 2024, the total market value of DePIN tokens has surged to over $25 billion. This surge was driven primarily by the computing, storage, and artificial intelligence sectors, highlighting the growing influence of these technologies.
DePIN Project Examples
Cloud computing: Akash and io.net
Akash is an open-source, decentralized cloud computing platform for buying and selling cloud resources. It connects individuals willing to sell excess CPUs or GPUs with those looking to buy. Known as the "Airbnb of cloud computing," Akash provides an open super cloud network that scales and accesses services around the world.
Akash is owned and managed by its community and is a free public service with source code open to everyone. Akash is built on reliable technologies such as Kubernetes and Cosmos, and the community oversees all aspects of Akash, including decisions on new features. However, it is limited to desktops and cannot be run on any device. In addition, it lacks some features such as variable collateral, GPU computing services, and proxy services.
In addition to Akash, another GPU DePIN platform is io.net. This is a decentralized GPU network that aims to provide unlimited computing power for machine learning (ML) applications, with 83,000 GPUs in its network. The platform is built on Solana and aims to save up to 90% of GPU computing costs compared to major cloud computing providers. Since io.net relies entirely on GPUs, it does not decentralize any applications and cannot be run on other devices.
Earn rewards by sharing data bandwidth: Grass
Grass is a decentralized network that collects public web data to train artificial intelligence models. By installing a browser extension, users can become Grass nodes, provide available Internet bandwidth to the network, and allow partners to collect data from public websites to train their own models. In return, users can earn points and rewards.
Although it provides proxy services, it does not have a multi-application runtime or flexible user bandwidth and privacy controls. Grass only focuses on Internet bandwidth, while DePINs such as Akash and io.net provide GPU computing resources.
Layer 1 DePIN for Any Device: Koii
Koii is a layer 1 protocol designed for DePIN, which aims to promote user growth and enhance global decentralized computing capabilities. Koii focuses on decentralizing physical infrastructure through blockchain technology, leveraging a distributed network and its K2 layer 1 chain with speeds up to 47,000 TPS to bring changes to various fields including telecommunications, energy, and transportation.
The main advantages of Koii include the fact that it can be run on any computer or laptop, not just high-end machines. The network already has more than 70,000 nodes, and participants can earn rewards by running module tasks that use the node's computing resources. In the upcoming release, it will also support mobile phones, lowering the barrier for anyone who wants to contribute their computing power and earn rewards.
Koii is a Solana-forked DePIN that can deploy a storage network and distribute rewards in KOII tokens, stablecoins, utility tokens, or popular alternative coins. This is in stark contrast to other DePIN computing platforms, which only offer rewards in the platform's own tokens as an incentive to add new nodes to the network.
DePIN’s supply and demand imbalance
Although physical nodes and integrated hardware have been introduced to provide decentralized resources, the DePIN market is still struggling to find the best revenue model. As a research report by ResearchGate highlights, most DePIN projects rely on a "burn and mint balance" model that requires supply and demand to balance. The system uses a dual-token approach, where contributors earn tokens and consumers destroy tokens during transactions, thereby maintaining economic stability.
Like many emerging markets, DePIN faces a supply and demand dilemma similar to the Goldilocks problem: finding just the right balance. Neither too much nor too little is good, what is needed is a perfect combination to stimulate interest and growth. Making resources more accessible to developers can encourage more people to participate and help the DePIN economy flourish. However, improving the accessibility of developer resources can also promote end-user participation in the colorful DePIN economy.
To simplify the onboarding process for builders, Koii has launched EZSandbox, a localized open source development tool. This tool not only allows developers to create nodes and share them with the community, but also focuses on local testing environments. EZSandbox provides comprehensive educational resources on setting up nodes, creating Universal Plug and Play (UPnP) tasks, and deploying data crawlers, which is invaluable for developers who want to test and refine their applications within a community-supported framework.
The progress of DePIN accessibility is reflected in Koii’s partnership with Web3 search engine Adot, which uses more than 5,000 Koii nodes to improve network indexing and access to X and blockchain information. This partnership represents a tangible benefit for decentralized computing and nodes, accelerating its development, improving resource efficiency and accessibility, and paving the way for widespread adoption of DePIN computing.
Unbinding the network with DePINs
Koii, Akash, Grass, and other DePIN platforms offer promising alternatives to centralized cloud services. By leveraging blockchain technology and nodes, these platforms reduce computing costs and increase accessibility to AI-friendly computing resources.
As the world becomes increasingly reliant on cloud computing, decentralized solutions will play a key role in shaping the future of how nodes are efficiently utilized and rewarded.
