With the rise of blockchain and increasing interest in decentralized solutions, DePIN has become a hot topic. While still in its early stages, DePIN has the potential to disrupt existing infrastructure models in various application areas.
DePIN, short for Decentralized Physical Infrastructure Network, is a collective term for networks that utilize blockchain technology to decentralize control and ownership of physical infrastructure in the real world.
Traditionally, physical infrastructure such as data networks, transportation, or power grids have been owned and managed by centralized entities. The DePIN project aims to replace this with a peer-to-peer (P2P) network, where individuals can contribute their physical resources and have shared control of the network.
While several Web2 centralized projects like Airbnb have successfully harnessed the power of communities, the DePIN project empowers users with decision-making authority and allows them to benefit from the growth of the network, further encouraging active community participation through decentralization and incentive mechanisms.
Built on blockchain technology, the DePIN project is more transparent, reduces reliance on single institutions, and is less prone to single points of failure. Additionally, as participants in DePIN are collective decision-makers, the driven community can more flexibly and efficiently manage the platform.
Use Cases of DePIN
The use cases of DePIN cover various fields such as distributed finance, data storage, telecommunications, transportation, and healthcare. Filecoin is one of the well-known DePIN projects, serving as a peer-to-peer decentralized data storage platform that ensures security and stability by utilizing personal computer networks. Data storage providers are rewarded by Filecoin for providing reliable data storage for a certain period. Other known examples of DePIN include Render, Livepeer, Akash Network, Helium, AIOZ, and Hivemapper.
“In one sentence, DePIN makes infrastructure intelligent and flexible through coordinated incentive mechanisms for participants,” said Kerem Ozkan, founder and CEO of Sar Robotics, the company behind the transportation DePIN project Soarchain. Soarchain aims to create a token-based data and connectivity infrastructure specifically for the mobility industry, enabling vehicles to securely collect and share data, thereby enhancing transport safety and efficiency.
In addition to transportation, Ozkan believes that DePIN can also promote the future development of artificial intelligence. One of the current problems facing AI is a lack of sufficient GPU, CPU clusters, and basic computing power. Ozkan believes that a token-incentivized and community-led DePIN data network has the potential to provide the scalability and agility currently needed for AI.
As the concept of DePIN garners increasing attention, several DePIN projects have begun receiving funding from venture capitalists. Blockless, which focuses on providing decentralized computing support, recently announced that it raised $8 million in seed and seed round financing. WeatherXM, a DePIN project that creates hyperlocal weather forecasts using environmental data stored on Filecoin, secured $7.7 million in Series A financing.
Future Challenges
Despite this, as a relatively emerging field, DePIN still faces challenges. Ozkan said, “The physical environment is uncontrollable, so interoperability, scalability, and any security issues related to the entire system are still challenges. Users will have different hardware and infrastructure access permissions, so you have to verify their trustworthiness and tamper resistance.”
Developers of DePIN say that this technology has the potential to have a significant impact like the early days of the railroad, but continuous innovation is needed for more widespread adoption.
