RECAP: “DEPIN IN SIMPLE TERMS: EXPLAIN LIKE I’M 5”

On 3rd Feb 2024, U2U Network, U2DPN, Hotspotty, and DePIN Daily had a great time sharing their incredible insights and knowledge with the community as well as other experts of the field who joined the exclusive AMA!

If you missed the AMA that gathered all the DePIN experts of U2U Network, U2DPN, Hotspotty, and DePIN Daily, then don’t worry, this recap will cover all the information for you!

Started the AMA, led by Ms. Trang Phung — CMO of U2U Network, an introduction of the esteemed guest lineup was provided to give the community an overview of the top-notch DePIN experience of the guests, including Mr. Luu Tran — CTO at U2U Network, Ms. Astrid — CBO at U2DPN, Mr. Michael Sothan — Head of Growth at Hotspotty, and Mr. Scott Foo — CEO at DePIN Daily.

Ms. Trang Phung: “What is DePIN? How would you explain it to someone who has no knowledge about DePIN?”

Started by Ms. Astrid, said that DePIN, standing for Decentralized Physical Infrastructure Networks, is generally related to hardware kind of things, which “involves using blockchain technology and token incentive to build and maintain physical infrastructures.”

Mr. Micheal indicated an interesting definition of DePIN for ease of understanding. He stated that DePIN is basically a way to flip the traditional business model on its head. So if you are a company normally you are going to invest a lot of money to build something and maintain it, and you will do it yourself, everyone else is “a passive consumer”, and none of the consumers will receive any profit from it. “The DePIN flips the whole model, instead of centralizing it, why don’t we open it up?”, he said. He also mentioned that this was the spirit of the Internet, a truly peer-to-peer model and that was how the Internet started. “Let’s get everybody else involved”. The better the job they do, the more money or tokens, in this case, they can make and have more rights on how the system is managed. “Instead of going top-down, we go bottom-up”. In the case of crypto, “we use incentives with tokens”, using tokens instead of physical infrastructure networks.

Following was the answer from Mr. Scott with an easy-to-understand example of Lego, everyone’s favorite toy of all time. He said that “Imagine you have a Lego set and you decide to build a big castle, usually one person tells everybody else what to do”, just like the traditional model. But when it comes to DePIN, it is like “All your friends have different Lego sets and decide to build the castle together”. No one is the boss, each person adds to “the castle” their own pieces, and when one of them adds in a special piece, “they will get a special sticker which symbolizes the incentive that Micheal was talking about”. With this new model, “the castle” is built and taken care of by everybody, making it more fun and stronger. Moreover, you can see “who adds which part to the castle” on the blockchain, which makes the source more open and fair.

To conclude the first question, Ms. Trang summarized all the answers from the guests to provide a comprehensive overview of what DePIN is. “Depin refers to infrastructure-related projects that utilize blockchain technology and crypto economics to motivate an individual or a group of individuals to allocate their capitals or their unused resources so that together they can create a transparent and verifiable network with the goal of achieving a more efficient scaling and centralize counterparts.”

Ms. Trang Phung: “How can DePIN fit in to solve the problem in the Web3 and Web2 space?”

To answer this question, all the guests agreed that DePIN can solve many problems, especially ones that are related to cost and efficiency.

Mr. Micheal: “It can solve many problems and one of the key problems is around capital expenditure and operational expenditure”. He also mentioned that to coordinate a traditional business model, you might need a lot of resources, including investment, time, and people. “But with DPN, it really changes”. Now, every single person with different interests can join and head to the same goal, earning more money, and in time, it will create a powerful network. “You can do that by just coordinating the individual interests and making them want more rewards which is also a challenge”, he stated. To do this, it’s all about making sure that the tokenomics is healthy and how people want to build and maintain the network, so it means that marketing is a crucial point. “If you are able to do this, well, it will be 8–10 times faster, 10–100 times cheaper”. As a testament, he highlighted the last point “Marketing is crucial and it’s all about spreeding the words to the right people who want to join”.

Ms. Astrid provided a very vivid example when she carried Uber into her answer. “They provide ride-sharing services by developing a platform that connects drivers with their own cars to people who need rides. This setup means Uber doesn’t own the cars; instead, it uses an app to make these connections. However, because Uber is a centralized entity, the power over its network, drivers, and business remains in the hands of Uber itself.” So it means that whenever there is bad feedback about the driver, it might or might not be resolved, which can have a bad effect on the user experience. Mr. Astrid stated many interesting points with this example. She talked about how blockchain, smart contracts, dApp, zero-knowledge proofs,… can facilitate such a system technically and support the business.

She also stated that cryptocurrencies could enable an economic model for this system, in which riders pay for services using these tokens, and drivers receive tokens as payment. Blockchain community-driven governance was mentioned after that as drivers and riders could vote on key decisions and changes within the network, such as fee structures, policy changes, or feature updates. Finally, she described some potential additional implementations, including a Decentralized feedback system, decentralized data storage, data privacy, etc. With her easy-to-understand demonstration, participants can see that DePIN can solve all the problems that recent business models are facing.

Furthermore, Mr. Scott agreed with the answers from Mr.Micheal and Ms. Astrid. He also added to Mr. Micheal’s answer in terms of the incentive system. He stated, “You will get a slice of the big data being sold, and everyone is keen on having an extra penny.”

Ms. Trang Phung: “Where is U2DPN in the DePIN sector map? How can it solve the current internet user’s problems better than traditional VPNs?”

Ms. Astrid: “We have a range of subnets, DPN is just a kick start”. As her statement, U2DPN is a pioneering solution that capitalizes on the robust capabilities of Decentralized Private Networks (DPN). U2DPN platform stands out by harnessing cutting-edge U2U Subnet technology from the Unicorn Ultra Network, effectively transforming ordinary million devices into Contributor Nodes (or DPN Providers), thereby unlocking the true potential of decentralized connectivity. “U2DPN can provide absolute privacy, and we can say that we are the world’s first ever mobility node”, a direct statement of Ms. Astrid about the position of U2DPN.

Moreover, she also provided the USP of U2DPN:

• Portable nodes on your phone
• One-click Installation
• No Code — “Make it easy for non-coder”
• Seamless integration with other mobile apps
• Free entry fee
• Contribute to Earn, pay as you go

From her answer and to make it easier to follow, here is a comparison of U2DPN with VPN:

Ms. Trang Phung: “What are some notable categories in DePIN? What can we expect from DePIN to replace the Web2 infrastructure?”

To answer this question, both Mr. Micheal and Mr. Scott agreed that DePIN and Web2 infrastructure will “co-exist”. The DePIN was carried out as a solution to advance the current systems, not to break them. “Company needs to buy the data and not about breaking the system”, Mr. Scott said. Mr. Micheal also added “It’s more about transparency, about the driver and the users, everything is fairer and not based on a third party. Both have pros and cons and they can learn and create a mix where everyone can join and gain rewards”.

Ms. Trang Phung: “Why should we pay attention to DePin in 2024?”

Ms. Astrid: In her answer, she stated that “People are getting wiser, switching to real value” and knew that “how the data is important to them”. In her words, DePIN has more ways to educate because it is involved in the users’ daily lives with a lot of blockchain platforms. She also indicated that there have been many case studies in the past, more than 100 deployed projects, and this is “not a risk, it’s an opportunity” to learn and further improve. A reason why the DePIN should be recognized, which she stated in her answer, is that DePIN doesn’t rely on the trend to grow, and it is suitable for mass adoption.

In addition to Ms. Astrid’s answer, Mr. Micheal added: One of the reasons why DePIN is so “trendy” is because “it has the most real use cases and real-world utility with actual demand”. This means that it can ensure the appropriate tokenomics and increase the token value. And as he said, that is how to “make millions of people will get on the web3 world”.

A crucial aspect of the DePIN was also demonstrated by Mr. Scott: “Timing is great!”. In his answer, he showcased that the DePIN arrived at the right time when the big perfect storm of RWA had just been approved and supported. “DePIN is everywhere, it is the perfect time to start”. He also indicated that the barrier to entry has never been easier, especially with the support of the RWA, now “many companies on the DePIN side”.

The Gathering has ended with some questions from the community, dedicated to each of our guests and their projects.

In wrapping up our enlightening AMA session on Xspace titled “DePIN In Simple Terms: Explain Like I’m 5,” it’s clear that we’re on the cusp of a DePIN revolution. U2DPN, U2U Network, Hotspotty, and Depin Daily have not only demystified the concept of DePIN for everyone but have also laid the groundwork for a future where privacy and decentralization take center stage. As we eagerly anticipate the public release of U2DPN’s groundbreaking product, prepare to be swept up in a storm of innovation that promises to redefine our digital landscape.

The horizon is bright with the potential of DePIN technology, and U2DPN is at the forefront, ready to usher in this exciting new era. Stay tuned, and get ready to embrace the transformative power of DePIN!