Introduction
In today’s tech world, the most imaginative fields besides encryption are AI. AI and encryption are currently the rising stars, and excelling in either industry can lead to great success in life.
Of course, there are some people who excel in both industries, such as Sam Altman, who we mentioned earlier. Through OpenAI’s ChatGPT, he has made a breakthrough in the AI industry. Additionally, he has also launched a cryptocurrency called WLD, which has become a leading token in the encryption field. He is now a pioneer in both industries.
1. What is the AI+Depin Track?
Are there any projects that can straddle two major tracks like Sam Altman? Actually, there are, and they seem to make more sense than the logic behind Altman’s projects. These projects focus on using web3 methods to build AI infrastructure. Since the rise of large models, the demand for AI infrastructure has been very high. AI infrastructure requires powerful computing power. According to a calculation by McKinsey, as early as January 2023, OpenAI alone consumed as much electricity in one month as 175,000 Danish households would use in a year. Compared to Bitcoin mining, AI infrastructure consumes a significant amount of electricity. In addition to the electricity consumption, the GPU chips used for computing power are also extremely expensive, costing hundreds of thousands or even millions of RMB. These are toys for enterprise-level players, and various centralized computing power data centers have been established. With such high barriers, we need web3 so that even retail investors can participate. We need to lower the threshold for AI technology infrastructure. The computing power of AI must be decentralized, and the data storage must be decentralized as well. The bandwidth used by AI must be distributed.
As a result, many AI+Depin projects have emerged this year.
AI is a familiar term, short for Artificial Intelligence. Depin stands for Decentralized Physical Infrastructure Networks. If this narrative comes true, your computer, phone, and other devices can become part of the decentralized physical infrastructure, earning money for you.
Because of the high demand for AI, many Depin projects this year are serving the AI industry.
The core elements of Depin include three points:
Decentralized: The first and most significant difference from traditional cloud providers is decentralization. In the past, many AI computing power and storage resources were provided by companies such as Amazon and Microsoft. The encryption revolution mainly aims to overthrow these large companies. The ideal result is to unite the devices of ordinary people to achieve a spark that can ignite a prairie fire. However, the final situation could be similar to Bitcoin mining, where the demand for AI computing power and storage is released through a publicly unified method, allowing anyone with computing power and storage resources to join.
Physical Infrastructure: These services cannot be provided by manpower or air; they require different types and sizes of hardware, such as various IoT, 5G information towers, servers, or even phones.
Token Economy: An economy that incentivizes the community to contribute and build the network.
If the project achieves these three points, it can be considered a Depin project. In fact, the most successful Depin project we are familiar with is Bitcoin mining. It is decentralized in terms of computing power, has physical infrastructure such as mining machines, and has Bitcoin as a token economic incentive.
2. Is this concept reliable?
Some viewers may ask whether the computing power required for AI calculations can only be achieved with specialized equipment, and whether ordinary devices like computers and phones are not suitable.
AI’s computing power requirements can generally be divided into three types:
The first is training large models, which requires high performance GPUs provided by companies like Nvidia. Currently, these GPUs are available.
The second type is running models after they have been trained and interacting with users’ queries, known as inference. The computing power required for inference is not as high as training, and companies like Nvidia, Huawei, and 2-3 domestic startups can provide it.
The third type is deploying small models on the edge side to run results, requiring even lower computing power, around tens of teraflops.
The first type requires specialized equipment and even if Depin projects are successful, they will likely be similar to Bitcoin mining, requiring high investment and not involving ordinary people.
However, for the second and third types of computing requirements, ordinary devices can still contribute.
3. AI+Depin Leading Projects
After discussing the demand for AI and Depin, let’s take a look at the popular projects in the AI+Depin field this year.
IO.NET
First, let’s introduce io.net.
Io.net is a decentralized AI computing power platform developed by IO Research based on Solana. In March of this year, it announced the completion of a $30 million Series A financing round with Hack VC as the lead investor, resulting in a valuation of $1 billion.
In terms of valuation, it is currently the highest among the projects we are introducing today.
So, what does Io.Net do?
According to io.net’s documentation, it can aggregate unused GPUs from independent data centers, cryptocurrency miners, and other hardware networks such as Filecoin and Render.
Who uses this computing power?
The current target users of io.net are AI startups and developers because these users are relatively poor and cannot afford the high costs of renting GPU/CPU computing power. Moreover, these companies typically do not require large model training and have less stringent device requirements, mostly needing to perform inference or compute edge-class models.
Who provides this computing power? Gamers and cryptocurrency GPU miners.
Gamers have high-end hardware and fast internet connections, but usually only have one GPU card. Cryptocurrency GPU miners have a large number of GPU resources but may face limitations in internet connection speed and storage space.
Therefore, if you want to participate in providing computing power to io.net, you need to assess the performance of your device. If it is not up to par, it’s better not to participate.
Doesn’t io.net make a lot of sense? It must have some good reasons for such a high valuation (there have been many recent rumors).
Aethir
Another heavyweight player is Aethir, which completed a Pre-A funding round in mid-2023, raising over $9 million with a valuation of $150 million. The funding round was led by well-known investors Sanctor Capital and Hashkey.
This project is a cloud computing platform that promises to completely change the current technological landscape by making GPU sharing, ownership, and usage scalable and inclusive. For areas such as artificial intelligence, cloud gaming, and machine learning, Aethir allows enterprises and individuals to contribute their idle GPUs to a shared network. This not only optimizes resource utilization overall but also provides convenient access to top-tier computing power for a wide range of users. In other words, they purchase GPU resources from users and sell the integrated computing power to major game studios. This is because the core of CPUs is graphics processing, and high-end games now require real-time rendering, which has a high demand for GPU computing power. It has been publicly reported that Aethir has signed contracts with the world’s largest game studios, with a player base of 150 million. Although the studio has not been disclosed, it is likely to be Riot Games, the creator of League of Legends, given its scale.
Moreover, it has an official partnership with WellLink, the largest cloud gaming company with over 64 million monthly active users.
While the upstream procurement side seems to be doing well, how about the downstream supply side?
According to the official information provided, over 40,000 devices have already been connected to the network as of March this year. It seems that the project is making progress.
It is worth mentioning that on March 20th this year, Aethir launched its “Checker Node” public sale, which raised $100 million in a day. It is said that they will soon sell small GPU mining machines, which is starting to resemble Bitcoin mining operations.
But can Aethir find so many users to participate in network construction? That is still unknown, but in terms of potential, it is definitely gaining momentum. Let’s guess in the comments, who will list on Binance first, Aethir or io.net?
Grass
As we mentioned earlier, both io.net and Aethir primarily focus on computing power on the supply side.
If a viewer asks, “I don’t have computing power, but my internet connection is good. Can I participate in mining by providing internet?”
Yes, there is a project called Grass that allows users to profit from selling unused internet resources.
According to the official description, Grass currently allows users to provide unused internet bandwidth through a web browser extension to earn points. These points will be “retrospectively converted into network ownership” when the product’s beta phase ends.
In simple terms, you can mine by simply using the internet. Even your phone can participate in mining.
This project completed a $3.5 million seed round of financing at the end of 2023, and while the funding amount may not be high, it was led by the renowned Polychain. As we mentioned before, the majority of infrastructure projects that list on Binance are invested in by Polychain.
Grass also had a pre-seed round in July last year, led by No Limit Holdings, an influential player in the crypto industry. The founder of No Limit Holdings is Gin Chao, the former third-in-command at Binance and the founder of Binance Labs. He also recently appeared on our show. No Limit Holdings has a high probability of investing in projects that list on Binance, and we mentioned before that Stroom, which we introduced earlier, is also invested in by this entity. Jeremy Huff, the COO of Morgan, recently joined the crypto industry and joined No Limit Holdings.
Therefore, Grass is considered to have been born with a golden key.
EMC
If a viewer says, “I don’t have computing power, but I have good internet. Can I mine by providing network connectivity?”
Of course, you can.
There is another project called EMC, which stands for EdgeMatrix Computing. It is a highly technical project incubated by Wanxiang Blockchain Lab and HashKey Capital, raising about tens of millions of dollars in two funding rounds. Its token, EMC, has been listed on exchanges such as Matcha and Gate, with a current market value of around $1 billion.
The EMC protocol is a blockchain and peer-to-peer network-based edge computing protocol that can integrate computing power and applications from different sources, enabling them to exchange and collaborate on a unified platform.
Individuals or professional developers can run EMC nodes and use personal computers or large GPU clusters to provide AI services and receive rewards, similar to miners.
In other words, you can use your ordinary laptop to mine and make money by connecting to the EMC network while sitting in a place like Starbucks, where you don’t have to pay for electricity. Doesn’t it feel like there is hope in life?
4. AI and Encryption, Let’s Stick Together!
Both AI and encryption industries are currently in the investment phase, meaning they are highly optimistic in the long term, but it is still difficult to determine short-term use cases and monetization.
However, the combination of AI and encryption through Depin may be the way forward.
Hopefully, one day your phones and computers can support you and make a living for you through your own efforts. It would make all the time spent on phones and computers worthwhile, even more than the time spent on relationships.
Goodbye!
