DePIN has become a hot topic as interest in decentralized solutions grows alongside the rise of blockchain. Although still in its early stages, DePIN has the potential to disrupt existing infrastructure models in a wide range of applications.
DePIN, short for Decentralized Physical Infrastructure Network, is a term used to describe a network that decentralizes control and ownership of physical infrastructure using blockchain technology.
Traditionally, physical infrastructure such as data networks, transportation, or power grids has been owned and managed by centralized entities. The DePIN project aims to replace this by creating 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 rights and allows them to benefit from the network’s growth, further promoting active community participation through decentralization and incentivization.
Built on blockchain technology, the DePIN project is more transparent, reduces reliance on a single entity, and is less prone to single points of failure. Additionally, as participants in DePIN are collective decision-makers, the community-driven platform can more flexibly and efficiently manage itself.
Use Cases of DePIN
DePIN’s use cases span across various fields including distributed finance, data storage, telecommunications, transportation, and healthcare. Filecoin is a well-known DePIN project, a peer-to-peer decentralized data storage platform that ensures security and stability by utilizing personal computer networks. Storage providers are rewarded with Filecoin for providing reliable data storage for a specified period of time. Other notable DePIN examples include Render, Livepeer, Akash Network, Helium, AIOZ, and Hivemapper.
“In a nutshell, DePIN aims to make infrastructure intelligent and flexible through coordinated incentive mechanisms among participants,” said Kerem Ozkan, the founder and CEO of Sar Robotics, the company behind the transportation DePIN project Soarchain. Soarchain is designed to create a token-based data and connectivity infrastructure specifically for the mobile industry, allowing vehicles to securely collect and share data to improve transportation safety and efficiency.
Ozkan believes that DePIN can also promote the future development of artificial intelligence. One of the current challenges in AI is the 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 needed for AI.
As the concept of DePIN garners more attention, multiple DePIN projects have begun to receive funding from venture capitalists. Blockless, focused on providing decentralized computing support, recently announced that it raised $8 million in seed and seed round financing. WeatherXM, a DePIN project that utilizes environmental data stored on Filecoin to create hyper-local weather forecasts, secured $7.7 million in Series A funding.
Future Challenges
Despite this, as a relatively emerging field, DePIN still faces challenges. Ozkan stated, “The physical environment is uncontrollable, so interoperability, scalability, and any issues related to the overall system’s security 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 while the technology has the potential to have a huge impact much like the early adoption of railroads, continuous self-innovation is necessary to achieve widespread adoption.
