Depin Track Research Report

Depin, as an infrastructure-related project in the Crypto space, utilizes blockchain technology and token incentives to encourage individuals to utilize idle funds or resources, creating a more transparent and verifiable network.

Due to its vast potential market, it has garnered widespread attention from crypto investors in the past few months.

1.Operational Principles of Depin:

Depin projects typically consist of five key components: target resources, hardware, token incentives, suppliers, and consumers. Depin projects need to determine the specific resources they can provide to consumers, such as network bandwidth, storage capacity, computing power, and so on.

The core of Depin project operations lies in its token incentive policy, which directly impacts users’ enthusiasm for participating in the project and whether the project can operate sustainably in the long term.

Additionally, suppliers are an indispensable part of the Depin project as they provide services to major networks, ensuring their operation (similar to validators in the Bitcoin/Ethereum networks).

Depin Project Sustainable Development Cycle Chart

Depin projects use their own token airdrops as an incentive measure to attract suppliers to participate in the project for building, achieving project cold start.

As the network scales up, consumers begin to use network services, leading to an increase in user demand.

Typically, the project’s token serves as a service fee, and the increase in user demand will lead to a rise in token prices, further incentivizing more users to become suppliers, achieving a positive feedback loop.

2. Various Sectors in the Depin Field:

Currently, projects in the Depin field show a trend of diversified development, primarily focusing on two main sectors: Physical Resource and Digital Resource, which can further be subdivided into multiple categories such as Sensor, Wireless, Compute, Bandwidth, and more.

2.1 Decentralized Computing Network

With the rise of technologies like blockchain and artificial intelligence, the demand for computing resources is increasing rapidly. Traditional centralized cloud service providers (such as Amazon Web Services and Google Cloud) are no longer able to meet current market demands and are often expensive.

The operation of a decentralized computing network involves establishing a bilateral marketplace that incentivizes computing power suppliers to provide idle computing resources to customers. As long as there are enough computing power suppliers, the market demand can be met, and prices are typically cheaper compared to centralized computing networks.

One prominent project in the decentralized computing network space is Akash Network, which allows users to deploy their own cloud infrastructure or sell idle cloud resources.

Currently, the network offers over 8,900 central processing units (CPUs), 171 graphics processing units (GPUs), 45TB of memory, and over 583TB of storage space. Users of Akash can efficiently complete any regular computing tasks using the network.

2.2 Decentralized Wireless Network Applications

Typically, building wireless network infrastructure requires substantial funding and is primarily led by large telecommunications companies with significant financial strength.

DeWi Network provides an alternative solution by incentivizing numerous small operators or individuals to collaboratively deploy wireless infrastructure through token incentives.

As the network scales up, users often need to purchase the project’s tokens to continue using the network. This leads to an increase in token demand and price appreciation.

Positive economic effects will encourage more operators to deploy wireless infrastructure, thereby achieving the sustainable development of the entire project.

Helium is a project in decentralized wireless infrastructure that provides wireless coverage for LoRaWAN IoT and cellular devices. Operators can earn $HNT tokens as a reward by purchasing FreedomFi Gateway hardware and providing cellular network support.

Currently, Helium has expanded its network hotspots globally to over 970,000, which is a significant achievement.

3.Summarize

There are many excellent projects in the Depin field, and it is not possible to list them all here. In summary, DPIN projects utilize distributed transparent systems to enhance the scalability and operational efficiency of infrastructure, aligning with the principles of the cryptocurrency industry and possessing significant market potential.

However, there are still many challenges in the process of popularization. DePIN cannot fully replace centralized networks in the short term, so it is likely to coexist with traditional infrastructure providers.