Decentralization Physical Infrastructure Network ( DePIN ) Status and Future Outlook

Introduction

The origin of the Internet can be traced back to the Cold War era. In 1969, the U.S. military developed a network system with decentralization characteristics to respond to potential nuclear strikes - ARPAnet(. This network adopted a distributed architecture, aiming to avoid single points of failure and possess autonomous recovery capabilities.

However, with the commercialization and globalization of the Internet, the transition from Web1 to Web2 has witnessed a shift in the Internet architecture from distributed to centralized. Large technology companies have gradually taken control of the Internet ecosystem, holding significant influence and rights to value distribution.

In recent years, the Web3 wave has emerged, advocating for Decentralization and de-platforming. However, it is not enough to achieve Decentralization merely at the application level; it is also necessary to fundamentally transform the internet architecture from the underlying tech stack. Against this backdrop, the Decentralized Physical Infrastructure Network ) DePIN ( has emerged.

DePIN combines the financial attributes and incentive mechanisms of Web3, aiming to build an efficient peer-to-peer physical resource network and create decentralized network infrastructure. It not only enhances the programmability of the network but also has the potential to give rise to a brand new internet architecture.

At the same time, the explosion of artificial intelligence in the Web3 field has injected new vitality into DePIN. This signifies that blockchain applications are expanding from on-chain activities to the real world, such as physical assets )RWA(, AI, and DePIN.

The rise of DePIN signifies that the boundaries between the physical reality and the blockchain world are gradually becoming blurred. Next, let us explore the current status and future development of DePIN.

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DePIN Overview: Definition and Significance

) Definition of DePIN

Decentralization Physical Infrastructure Network ### DePIN ( is a model that combines physical infrastructure resources with blockchain technology. It coordinates global resource collaboration through distributed ledgers, token incentives, and smart contracts.

In short, DePIN creates a "resource sharing + economic incentive" bilateral market by combining hardware with blockchain. This community-driven model is more flexible than traditional centralized resource management, and it also offers greater scalability and robustness.

) The basic operation mode of DePIN

A complete DePIN network typically consists of the following components:

1. Off-chain hardware devices: can be divided into the following categories:

• Customized dedicated hardware: such as Helium's hotspot devices, Hivemapper's dedicated dash cams, etc.
• Professional-grade hardware: such as idle computers with GPUs and CPUs
• Smart mobile devices: such as smartphones, smartwatches, etc.

2. Proof Mechanism: By using physical work proof ### PoPW (, the data generated by the device is uploaded to the blockchain, providing transparent and auditable records.

3. Identity verification: Verify the on-chain address of the device owner

4. Reward distribution: Tokens will be distributed to the corresponding address based on contributions.

5. Demand Matching: DePIN Market Platform, achieving resource exchange and matching between supply and demand.

) The significance of DePIN

DePIN aims to address a series of issues faced by traditional centralized physical infrastructure networks:

1. Centralized control: Vulnerable to attacks, low transparency, users lack control.
2. High entry barriers: New entrants face significant capital investment and complex regulations.
3. Resource waste: Centralized management leads to low resource utilization.
4. Insufficient incentive mechanism: User participation is low.

In contrast, the core values of DePIN include:

1. Resource sharing and digitization: Transforming idle physical resources into tradable digital assets
2. Decentralization Governance: Based on open protocols and cryptoeconomic models, achieving fair and transparent incentives.
3. On-chain settlement: Reducing costs through blockchain
4. Innovation: Open permissionless systems accelerate experimentation speed

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Current Status of DePIN Development

) Track Overview

DePIN, as one of the early developing directions in the blockchain field, initially focused mainly on storage and communication technologies, such as Helium, Storj, and Sia. With the development of the Internet and the Internet of Things, DePIN projects have gradually expanded into multiple fields including computing power, data collection and sharing, wireless, sensors, and energy.

Currently, the top 10 projects by market capitalization in the DePIN field are mainly concentrated in the storage and computing power sectors. At the same time, artificial intelligence has become the keyword of this cycle in DePIN, giving rise to a batch of AI DePIN projects dedicated to providing underlying infrastructure support for the training, inference, and deployment of AI models.

Market Size

According to data from DePIN Ninja, the number of DePIN projects that have been launched has reached 1,561, with a total market value of approximately $22 billion. Messari predicts that by 2028, the DePIN market size may exceed $35 trillion, potentially adding $10 trillion to the global GDP over the next decade.

mainstream public chain

The current DePIN projects are mainly focused on deployment on the Solana public chain, as well as on DePIN dedicated chains such as IoTex and Peaq. At the same time, Polygon and Arbitrum are gradually becoming rising stars.

Development Direction

Currently, DePIN projects are mainly divided into two directions:

1. Focus on the middle layer of DePIN
2. Focus on the expansion of DePIN demand side

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DePIN Middleware

DePIN-related IoT devices need to be integrated into the blockchain on a large scale, which presents technical challenges and liquidity pressures. Therefore, the DePIN track has given rise to middleware that connects devices and the DePIN network, aiming to assist project parties in quickly launching DePIN applications.

) DePIN Infrastructure

• DePHY: Providing open-source hardware solutions, SDKs, and tools for DePIN projects
• W3bStream: Allows IoTeX DePIN projects to easily generate logic based on smart device data to trigger blockchain operations.

Liquidity Plan

• PINGPONG: DePIN liquidity and service aggregator, optimizing mining profits across multiple networks
• Parasail: A re-staking protocol specifically designed for DePIN services, providing economic guarantees for DePIN services.

DePIN Application Layer

The DePIN application layer occupies most of the DePIN track, mainly divided into four major sectors: cloud network, wireless network, sensors, and energy.

Cloud Network

Including Decentralization storage and computing:

• Storage: Filecoin, Arweave, etc.
• Computing Power: Render Network, io.net, PinGo, etc.

wireless network

Including 5G, WiFi, Bluetooth, LoRaWAN, etc:

• 5G:Pollen Mobile
• WiFi: Wicrypt, Roam, Wifi Dabba
• LoRaWAN:Helium

Sensor

Mainly used for monitoring and capturing data related to environment, geographical location, health, etc:

• Environment: WiHi ### weather forecast (
• Geography: HiveMapper ) map data collection (

) Energy

• Starpower: Create Decentralization Virtual Power Plant
• Powerpod: Decentralization community charging station network
• Arkreen: Provides access to renewable energy data

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Future Trends of DePIN

1. Integration with Web2 application scenarios: DePIN is expected to play a role in multiple fields such as the Internet of Things, smart cities, energy sharing, and edge computing.

2. Lowering hardware barriers: Transitioning from professional-grade devices to consumer-level products, such as encrypted mobile phones, smartwatches, etc.

3. Financialization: The tokenization of physical hardware has opened up the imaginative space for on-chain finance in DePIN.

4. DePIN and AI Mutual Support: DePIN provides computing power, models, data, and other resources for AI, while AI helps DePIN optimize network resource allocation.

Challenges Facing DePIN

1. Technical implementation is complex: it requires the integration of different types of physical hardware and Decentralization protocols.

2. Uncertain market acceptance: How to persuade users to switch to the DePIN network and bear the high initial costs.

3. Uncertain profit model: The sustainability of the token economic model is in doubt.

4. Regulatory Risk: DePIN involves critical areas and may trigger regulatory intervention.

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Key Factors for Evaluating DePIN Projects

1. Hardware:

   • Self-made vs Third-party
   • One-time vs Ongoing Costs
   • High Density vs Low Density
   • Scarcity vs Commonness

2. Tokenomics Design:

   • BME)burn and mint equilibrium(
   • SFA)stake for access(
   • Token empowerment ) governance, staking, etc. (

Summary

DePIN builds a distributed bilateral market through the infrastructure of Web3 and token economy, which is expected to reshape production relationships and unleash productivity. It integrates global idle resources and addresses the issues of resource monopoly and inefficient distribution under traditional centralized models.

Although DePIN shows great potential, it still faces challenges such as technological maturity, service stability, market acceptance, and regulatory environment. The development of DePIN relies on the flywheel effect, requiring long-term accumulation and sedimentation, and it is believed that it will surely become an important new benchmark for infrastructure in the future.

![The Rising Narrative: A Glimpse into the Present and Future of DePIN])https://img-cdn.gateio.im/webp-social/moments-dd126d3536c461596c7c14b23b2b7e1a.webp(