AI and resource-intensive industries such as data storage have become the backbone of real-world infrastructure. DePIN (Decentralized Physical Infrastructure Network) is reshaping the blockchain sector through innovative use of existing infrastructure and data-centric business models.
Unlike traditional Internet of Things (IoT) systems, DePIN focuses not only on hardware devices but also on the value extraction and circulation of data. Through its decentralized network architecture and incentive mechanisms, DePIN encourages participants to collectively maintain and contribute data, thereby maximizing the value of data.
As of 2023, data from Messari and DePIN.Ninjia shows that the DePIN ecosystem includes 650 projects with a total market value of $35 billion. These projects cover various fields, including 250 in the computing sector, 200 in artificial intelligence, 100 in wireless technology, 50 in sensors, 50 in energy, and 25 in services. It is estimated that the current market valuation of DePIN is close to $2.2 trillion, with an expected growth to $3.5 trillion in the next four years.
With a reliable and extensive data infrastructure, DePIN relies heavily on community participation as the cornerstone of its decentralized hardware network. Many projects, including io.net, are primarily focused on Solana, leveraging its advantages in liquidity, speed, scalability, and cost to deliver value and unlock potential economic value.
Being the preferred option for deploying DePIN projects, the Solana DePIN project has a fully diluted valuation (FDV) of over $10 billion and a market value of over $4 billion.
Recently, Flipside released the Solana DePIN semi-annual report, and this article by PANews highlights four major DePIN projects on Solana: Render Network, Helium, Hivemapper, and ShdwDrive, analyzing on-chain data and the latest developments of these projects.
Render Network (RNDR) provides GPU rendering services through decentralized computing to support the rendering process required by creators. The project offers a distributed GPU rendering platform, allowing nodes to provide idle GPUs, enabling creators to utilize GPUs without hardware limitations, and allowing GPU owners to profit from it.
Recently, Render’s Octane software was recommended by Apple, highlighting its growth momentum. Since migrating to Solana in November 2023, Render has successfully generated 33 million still images. These images could be part of movies, TV shows, games, or other types of visual content. In comparison, rendering the same number of images continuously using an NVIDIA RTX 3090 GPU (currently a high-end consumer GPU) would take 1,375 days (approximately 3 years and 9 months).
The number of active node operators reached a peak of 19,000 in January 2024, showing a growth of 66.3% since the migration. With the increasing demand for GPU performance, it is expected that more projects will follow in the footsteps of Render and build infrastructure on high-performance blockchains like Solana.
Helium Network is a wireless network project that migrated to the Solana blockchain in April this year. It enables decentralized wireless network connectivity through the use of distributed nodes instead of centralized infrastructure, leading to a paradigm shift in the communication field.
Currently, Helium offers both IoT and mobile services. In the past six months, the Helium ecosystem has experienced significant growth, especially in the mobile network sector. Helium Mobile has attracted nearly 90,000 users in less than a year and has maintained this growth above the 2023 level. This growth is largely due to Helium Mobile’s announcement last year to launch unlimited 5G telecom services nationwide for only $20 per month, bringing decentralized network services to the general public.
The graph below shows that the DC burn of Helium Mobile far exceeds that of the IoT network, indicating a significant increase in network usage and adoption due to the launch of the 5G telecom service project.
In addition to user growth, Helium Mobile has also incentivized network participation through various measures. The distribution of Mobile Discovery rewards has significantly increased since December 2023, with more and more users actively participating in network coverage and data collection tasks to earn more MOBILE tokens, surpassing the growth rate of new users. With the accelerated deployment of 5G, the Helium ecosystem is expected to maintain strong growth in the coming years.
Hivemapper is a decentralized digital mapping network that creates global real-time 3D maps through map and spatial data drawing, competing with traditional players like Google Maps. It launched its native cryptocurrency, HONEY, in 2022 to reward users of dashcams who provide driving data and road images.
In less than two years, Hivemapper has mapped over 50 million kilometers of roads, and the total mapped roads exceed 200 million kilometers according to official data. Its incentive model promotes strong community participation, as shown in the graph below, with nearly one-third of HONEY token holders being active contributors. This high level of participation is driven by Hivemapper’s incentive model, where contributors can earn HONEY by participating in activities such as mapping, quality assurance, and training Map AI.
With the growing demand for high-precision map data in next-generation applications such as autonomous driving, decentralized solutions like Hivemapper are expected to receive more attention and investment.
ShdwDrive, as one of the emerging participants on Solana, is a decentralized storage solution that is a key pillar of the DePIN ecosystem, providing secure and data hosting solutions for Web3 builders. Although ShdwDrive has not yet launched its mainnet, it has shown significant achievements in the testnet. In a recent test, the network demonstrated the ability to process up to 38,000 transactions per second under high load conditions. The number of SHDW token holders has also steadily increased, reaching a peak of 67,000 in March 2024.
DePIN’s composability with other ecosystems positions it to transform the economic system through data integrity and scalable suite solutions. Therefore, the continuous growth of data is inevitable, and projects like ShdwDrive are expected to provide users with more secure and flexible space, driving new use cases and innovations in the entire Web3 ecosystem.
What challenges does the DePIN project face?
In the process of realizing the vision of all the projects described, the integration of physical devices with blockchain is the first and foremost complex process. The core of DePIN projects lies in building seamless integration between physical devices and data, which requires meeting technical requirements as well as considering cost-effectiveness and market acceptance. Currently, most project teams cooperate with hardware manufacturers such as sensors and monitors and install DePIN applications on existing devices. However, how to ensure data security and privacy while achieving large-scale device connectivity and data interaction remains a challenging problem to be solved.
Secondly, performance bottlenecks and storage consensus are also significant challenges that DePIN projects need to face. When millions of devices are simultaneously running on the blockchain, existing blockchain infrastructure struggles to provide sufficient performance support. Although high-performance public chains like Solana provide new choices for DePIN projects, they may only be suitable for the Minimum Viable Product (MVP) stage.
Furthermore, the core of decentralization is the verifiability of data, while IoT devices often involve non-deterministic data sources. It is essential to build a robust data traceability and authentication system and use statistical and artificial intelligence techniques to simulate historical data to ensure the authenticity and reliability of the data.
The DePIN project is at a stage of development full of opportunities, but it also cannot ignore the challenges it brings, such as data and efficiency, as well as centralization. For example, for applications like geolocation services, users want to ensure their privacy, while project teams expect to ensure the fairness of the system, leading to a contradiction between personal privacy and data security. Therefore, how to continue to focus on technological innovation, long-term business models, and other aspects will determine whether the DePIN project can truly achieve the integration of the physical world and the digital world, ushering in a new era of the next-generation Internet.
