DePIN Spotlight: Assessing developments, ecosystems and challenges

Author: Beosin; Translation: Vernacular Blockchain

In recent years, the Helium Mobile project in the Solana ecosystem Widely popular, its Token MOBILE has risen rapidly with a market value of US$700 million. Subsequently, the DePIN track owned by Helium Mobile gained widespread market attention and became an important narrative after BTC scriptures and protocols.

What is DePIN? Besides Helium Mobile, what other promising concept projects are there? What are their associated security risks? Today the Beosin team will analyze these aspects for you

1. The origin of DePIN

DePIN (Decentralized Physical Infrastructure Network) refers to a decentralized physical infrastructure network that encourages individuals and enterprises around the world to build various physical infrastructure in a decentralized manner through the use of blockchain technology and Token rewards ( Such as WiFi, hard drive storage, battery, etc.), providing services to everyone.

Previously, there was no unified description of this emerging track.

In 2019, Mult1C0in Capital partner Kyle Samani called related decentralized physical infrastructure projects the "Internet infrastructure stack."

In 2021, IoTeX, which focuses on the Internet of Things public chain, named this track MachineFi. Later, other projects such as "Token Incentive Physical Network" appeared. name. In November 2022, Messari voted on the name of the Web3 physical infrastructure track, and DePIN became the unified name thereafter.

2. DePIN concept project and its risks

DePIN covers a wide range of industries, Messari According to the hardware, resources, goods and services provided by the network, it is divided into physical resource network and digital resource network.

Representative projects in each field are as follows:

1) Helium and Helium Mobile

Helium is a decentralized wireless network protocol. Since 2017, Helium has used blockchain technology and token incentives to encourage users to deploy wireless networks. Its concept of a decentralized network and the low entry barriers to Helium hotspots have attracted quite a few participants. As of the end of 2021, Helium Hotspot's total sales exceeded $250 million.

In 2022, due to fewer users using the Helium network and insufficient Helium network node rewards, monthly revenue from a Helium hotspot device dropped to only $20. Therefore, Helium decided to migrate to the Solana network to attract more users.

As part of the migration, Helium subsidiary Helium Mobile is offering SIM cards and free trials to its mobile customers through Solana Labs' Saga phone. On December 6, 2023, Helium Mobile launched a $20 per month unlimited phone plan in the United States that covers data, messaging, and calls. Users who purchase the program will receive NFT and participate in MOBILEToken airdrop rewards.

Helium Mobile's business model is similar to that of telecom operators, offering affordable phone plans. Users can obtain MOBILE Token through eSIM. Helium Mobile's business flywheel involves attracting users through low-cost services and tokens. User growth drives up token prices, thereby attracting more users to pay for Helium Mobile services.

Currently, MOBILE Token is only used as the governance token of Helium Mobile. Its current market capitalization exceeds US$400 million, and its fully diluted valuation exceeds US$1.1 billion. Users should be cautious about short-term speculative risks.

2) Internet of Things IoTeX

IoTeX is a decentralized Internet of Things public chain , aiming to combine blockchain, trusted hardware and edge computing to achieve a trusted Internet of Things. According to EagleEye on-chain data analysis, the IoTeX ecosystem covers various tracks including DePIN.

IoTeX’s Token is worth approximately US$600 million, with a circulation rate of over 90%.

3) DIMO Network

DIMO Network is an IoT platform that allows drivers to collect and share vehicle data to earn DIMO Tokens. DIMO Network, which closed $9 million in funding in 2022, connects more than 28,000 vehicles.

DIMO’s Token DIMO has a market value of more than $96 million, and trading users should pay attention to price fluctuations.

4) Streamr Network

Streamr Network is a decentralized network designed to collect and publish low-latency real-time data streams from IoT sensors, machines, and other smart devices. Streamr has cooperated with DIMO Network, Swash and other data platforms.

Streamr's Token DATA has a market value of more than $70 million, and EagleEye found potential concentration risks.

3. The impact and significance of DePIN

Compared with traditional physical infrastructure networks , DePIN has the following advantages:

1) Quick start

Compatible with traditional hardware foundation DePIN projects require only a fraction of the operating and maintenance costs compared to facility companies. By significantly reducing upfront capital requirements and leveraging Token incentives, DePIN's startup costs can range from hundreds of thousands to millions of dollars, lowering industry entry barriers and enabling faster deployment than traditional projects.

2) Community first

In DePIN, the community owns all the hardware that makes up the network , providing products and services that the community needs and uses. DePIN community users are not tied to companies and businesses that are primarily interested in profits and financial reporting. This alignment of interests has fueled the adoption and growth of DePIN services.

3) Open governance

With the traditional management of terms and conditions stipulated by a centralized entity Unlike infrastructure projects, DePIN is open, democratic, and accessible. DePIN’s services can be used by anyone, anywhere, and anyone can participate in building the physical infrastructure that benefits them.

4. Conclusion

Due to market liquidity and sentiment recovery, the DePIN track and its The concept project gained huge popularity and an influx of funding in just a few weeks. DePIN is an application layer targeted at real-world users, providing huge promotion potential for Web2 users and enterprises, leading Web3 into the widespread adoption stage.

But users should be aware that for the DePIN project, the current narrative effect and flywheel effect are obvious and closely related to market conditions. The current high demand for Hivemapper, Render, Helium, and Helium Mobile within the Solana ecosystem can be attributed in part to Solana's resurgence. As the market matures and projects develop, the evaluation of project value will ultimately return to profitability rather than narrative and speculation. Whether the DePIN track project can truly achieve a profit model, the security of smart contracts, and stable development and implementation are still unknown variables.