Decentralized Physical Infrastructure Network (DePIN) or distributed computing is emerging as one of the hottest sectors of 2024 within the crypto industry. With the potential for mainstream adoption, DePIN projects are highly versatile, offering numerous real-world use cases and applications that harness the power of blockchain technology. The total market cap of DePIN projects exceeds $12.25 billion at the time of writing, as per data on CoinGecko.
Investment management firm VanEck has included the growth of the DePIN market and the rising adoption of DePIN projects as one of the top 15 predictions for the crypto industry in 2024. With this in mind, our article aims to explore the forefront of this technological revolution, highlighting the top DePIN projects reshaping the landscape of blockchain and web3.
What Is a Decentralized Physical Infrastructure Network (DePIN)?
The Decentralized Physical Infrastructure Network (DePIN) sector in the crypto industry refers to blockchain-based projects that focus on creating decentralized versions of traditional physical infrastructure. This includes decentralized storage networks, wireless networks, and other infrastructure services.
DePIN is an innovative concept that integrates physical infrastructure with decentralized blockchain technology. This integration enhances security, scalability, and efficiency in various applications. The evolution of DePIN signifies a significant shift in the industry, paving the way for a more robust and resilient digital infrastructure.
The Role of Hardware Decentralization in the DePIN Sector
Hardware decentralization in the DePIN sector involves distributing the physical components of network infrastructure across a wide array of individual operators rather than centralizing them in a single location or under a single entity's control. This decentralization enhances network resilience and security, reducing vulnerability to localized failures and attacks. It also promotes a more democratic and equitable infrastructure, allowing various participants to contribute resources and share in the network's benefits, including potentially earning rewards for their contributions.
Advantages of DePIN Crypto Projects
Decentralized Physical Infrastructure Networks (DePIN) offer several advantages:
- Enhanced Security and Resilience: The decentralized nature of these networks makes them less susceptible to centralized failures or targeted attacks.
- Scalability: DePINs can quickly scale as they rely on distributed nodes, each contributing resources to the network.
- Lower Costs: Using decentralized resources reduces the costs associated with building and maintaining the infrastructure.
- Democratization of Access: DePIN allows more participants to contribute and benefit from the infrastructure, fostering a more equitable ecosystem.
- Innovation and Flexibility: The decentralized approach encourages innovative solutions and adaptability to changing needs and technologies.
Key DePIN Crypto Projects to Watch in 2024
Now that you’ve gained a basic understanding of DePIN or distributed computing, it’s time to look at some of the best DePIN crypto projects in the market:
1. Filecoin (FIL)
Filecoin is a decentralized storage network designed to store humanity's most valuable information. It allows users to rent out their spare storage in exchange for FIL tokens. The FiIL token is used as payment for storage and retrieval services.
The network grew substantially, storing over 1.7 EiB of data with support from more than 3,300 storage provider systems, and the community fostered growth through active engagement. A significant development was the launch of the Filecoin Virtual Machine on its mainnet, introducing smart contract capabilities and expanding the utility of FIL tokens for decentralized application creation.
The FIL token displayed a bullish trend with some fluctuations but growing by over 82% in the past year, reflecting growing market confidence. Filecoin Plus was introduced as an optional layer to the core protocol, providing an alternative pathway for data onboarding and incentivizing storage providers, focusing on deal distribution and retrievability compliance to enhance network integrity and efficacy.
2. Helium (HNT)
Helium provides a decentralized wireless network for Internet of Things (IoT) devices, utilizing an innovative Proof of Coverage consensus algorithm. HNT tokens incentivize network coverage and data transfer.
What sets Helium apart is its innovative use of blockchain technology to incentivize the creation of a wireless network infrastructure. The network relies on individuals to host hotspots – physical devices that provide network coverage and, in return, earn rewards. Helium's standout feature is its unique consensus mechanism, the Proof-of-Coverage (PoC), which validates the authenticity and quality of the network coverage provided by these hotspots.
The value of its HNT token surged from $1 to $6.8, accompanied by momentum in Helium Mobile and Helium IOT tokens. Helium topped LunarCrush’s AltRank, indicating strong social and market activity, and anticipated major upgrades following its migration to Solana. The market capitalization of Helium Mobile surpassed $500 million due to its innovative approach to offering unlimited mobile services at affordable prices, leading to increased subscribers and investor interest.
3. Streamr (DATA)
Streamr is a platform that enables the real-time exchange of data in a decentralized manner, enhancing security and transparency in data transactions. It allows data producers, such as IoT devices, social media platforms, and online applications, to provide their data streams securely and efficiently. The platform also offers a mechanism for data producers to monetize their data by selling it to potential buyers on the network.
The native token of the Streamr network, DATA, is primarily used as a means of exchange within the ecosystem, with buyers using DATA to purchase real-time data streams from sellers. DATA tokens also incentivize network participants, including data providers and consumers, ensuring active engagement and contribution to the ecosystem.
Streamr has been diligently working towards the launch of its 1.0 network, conducting internal tests, governance votes via SIPs, and setting up public testnets in preparation for the mainnet. The beta release of the chat app, a decentralized messaging platform built on Streamr, offers secure, token-gated chats and fast transactions, leveraging IPFS and WebRTC for true decentralization. Streamr's integration with Lit Protocol enhances data accessibility by enabling the decryption of historical data. At the same time, a partnership with Flux facilitates easy node deployment on the Flux Cloud, bolstering network scalability.
The Streamr Open Data Challenge spurred community engagement by rewarding innovative uses of real-time data, and the ecosystem grew with the addition of Dedrop, a decentralized file-sharing app, and the Zonaris node dashboard, streamlining node management and emphasizing Streamr's commitment to user-centric development in the web3 space.
4. Bittensor (TAO)
Bittensor is a decentralized neural network that integrates blockchain technology with artificial intelligence to enable a network of machine learning models, distinguishing itself in the decentralized AI sector. Its native token, TAO, plays a crucial role in the ecosystem by incentivizing nodes that contribute computational resources for AI computations and potentially granting governance rights to token holders, thus fostering participation in the network's development and decision-making processes.
Bittensor has made significant strides in 2023, notably with its listing on KuCoin, enhancing the TAO token's accessibility and appeal. The project has advanced its decentralized machine-learning protocol, incorporating cutting-edge technologies like Proof of Intelligence and a Decentralized Mixture of Experts model, which allows for the exchange and collaboration of AI services in a peer-to-peer network. This innovation ensures compatibility with existing machine learning frameworks from tech giants, facilitating the integration of decentralized and traditional AI methods.
Bittensor's technology opens up a myriad of potential real-world applications, ranging from virtual assistants to medical diagnosis, highlighting its capacity to revolutionize various industries and push the boundaries of AI development.
5. Storj (STORJ)
Storj offers a decentralized cloud storage solution that prioritizes security and privacy by encrypting and distributing data across a network of nodes, ensuring no single point of failure and maintaining performance on par with centralized services. The STORJ token facilitates transactions within the ecosystem, used to pay for storage services and reward node operators for contributing their unused storage space, thus bolstering the network's capacity and reliability.
Storj has unveiled "Storj Next," a significant update introducing new features and economic incentives to rival traditional cloud storage providers like Amazon S3. This version focuses on delivering a secure, cost-effective, and efficient decentralized storage solution, leveraging sharding to enhance data security by distributing encrypted file fragments across a global network of drives. This bolsters security and ensures data remains accessible even if parts of the network fail.
Storj Next caters to a wide range of applications, from personal backups to scalable enterprise storage, and is compatible with Amazon S3, facilitating easy integration for developers. Additionally, the platform offers flexible pricing and utilizes STORJ tokens for transactions and rewards, incentivizing node operators to contribute storage space and services. The introduction of an IPFS Pinning Service further extends Storj's capabilities, particularly for decentralized applications and NFTs, solidifying its position as a versatile and user-centric decentralized storage marketplace.
6. Internet Computer (ICP)
Internet Computer is a decentralized computing platform designed to be a comprehensive alternative to the traditional IT stack, aiming to host software, services, and digital assets on a reinvented internet. It features an innovative Threshold Relay consensus mechanism, enhanced by the Network Nervous System (NNS), to provide a scalable, secure environment for decentralized applications, focusing on interoperability and high-speed data processing.
The platform's native ICP token is integral to its ecosystem, facilitating network governance by allowing token holders to vote on upgrades and economics, serving as payment for computational and storage resources, and rewarding participants like data center operators for their contributions to the network's maintenance and management.
Key advancements in the Internet Computer ecosystem through 2023 included the implementation of Websockets for dynamic, real-time application updates and an expansion of stable memory to over 100GiBs for supporting complex applications. There were also improvements in stable structures for efficient, large-scale data management. Additionally, Demergent Labs made progress on projects like Azle, Kybra, and Sudograph, enhancing developer tools on the platform. Furthermore, the WASM binary limit was increased, allowing for the development of more complex applications in various programming languages.
7. Bware (INFRA)
Bware (INFRA) is a unique decentralized physical infrastructure network (DePIN) project. It focuses on providing decentralized infrastructure services. Bware integrates various blockchain infrastructures for enhanced functionality, making it stand out. The native token, INFRA, is used to access and pay for these infrastructure services. Bware's approach to integrating diverse blockchain technologies underlines its commitment to improving the efficiency and accessibility of decentralized infrastructure services.
The INFRA token enables the transition of the Blast API to a decentralized and permissionless platform, fueling its growth and development. In 2023, Bware Labs made a significant move in the decentralized web3 infrastructure space by launching its INFRA token. This launch is a part of their mission to become a comprehensive provider of high-performing infrastructure services and developer tools for blockchain builders.
8. Theta Network (THETA)
Theta Network (THETA) is a decentralized video delivery network powered by blockchain technology. It stands out for its innovative approach to improving video streaming quality and reducing costs. The network leverages users' spare bandwidth and computing resources, creating a more efficient video streaming ecosystem. The native token, THETA, is used for various purposes within the network, including incentivizing users who share their bandwidth, governance participation, and as a payment method within the ecosystem.
ThetaCon 2023 marked a pivotal moment for the Theta Network ecosystem, uniting creators, developers, and enthusiasts in celebrating decentralized content delivery and blockchain technology, focusing on video, media, and entertainment. The conference underscored Theta's integration into mainstream entertainment through strategic partnerships with industry giants like Sony, Samsung, and Google while inaugurating the Zilly Awards to honor notable community contributions.
Concurrently, the Theta Network API saw significant enhancements, including launching the Theta Explorer API, which offers a robust development tool for enterprises and bolsters DeFi and web3 integration with improved on-chain data access. These technical upgrades have also improved the network's capacity and transaction speed, streamlining the functionality of Theta bridges.
9. BitTorrent (BTT)
BitTorrent’s legacy as a pioneer in decentralized file distribution, combined with its adoption of blockchain technology and the utility of the BTT token, makes it a significant project in the DePIN space. BitTorrent features a decentralized file-sharing protocol that enhances the distribution of large files like videos and software, becoming more efficient as user numbers increase.
The native BTT token serves multiple roles within this ecosystem: it incentivizes users to share bandwidth, improving network performance; acts as a transactional currency for buying better download speeds or premium content; and enables engagement with dApps on the BitTorrent platform, leveraging blockchain technology for a more interactive experience.
In 2023, the BitTorrent (BTT) ecosystem experienced a notable development with a significant increase in the value of its BTT token, up by almost 80% in the past year. The surge in the token's value was associated with the growth of the Tron blockchain, on which BTT is issued, reaching 200 million users. This milestone for Tron, a major player in the DeFi sector, positively influenced BitTorrent's market performance. BitTorrent's market cap approached $1 billion, and its daily trading volume increased substantially.
10. Arweave (AR)
Arweave (AR) distinguishes itself by offering a permanent, low-cost data storage solution on its blockchain protocol. The native token, AR, is used to pay for data storage, with a one-time fee ensuring that the data is stored forever. Arweave's approach to decentralized, permanent data storage and the utility of the AR token for facilitating this service makes it a significant project in the DePIN sector.
In 2023, the Arweave ecosystem experienced significant growth, illustrated by its Q3 2023 Ecosystem Map, which includes over 130 projects. These projects collectively contributed to 1.28 billion transactions on the chain. This expansion includes the addition of over 30 new teams since the end of 2022. The Arweave ecosystem stands out for its diversity, spanning various sectors like news, publishing, social, education, DeFi, and NFTs.
Future Outlook of the DePIN Market
The future of the DePIN sector is characterized by substantial potential and growth, driven by technological advancements and a shift towards decentralized systems. Amid the proliferation of web3 technologies, the DePIN sector could play a pivotal role in shaping next-generation digital infrastructure, emphasizing security, efficiency, and user empowerment.
With the evolving landscape of blockchain technology and increasing adoption, DePIN projects offer exciting investment opportunities, attracting both individual and institutional investors. The trend towards sustainability and decentralized solutions further bolsters the sector's prospects, positioning it at the forefront of innovative and resilient digital infrastructure development.
Conclusion
In conclusion, the decentralized physical infrastructure network (DePIN) sector is poised for significant growth, offering a transformative approach to traditional digital infrastructure. With its focus on security, scalability, and decentralization, DePIN projects are attracting increasing attention from investors and traders in the crypto space. The sector not only presents opportunities for technological innovation but also offers potential investment avenues. DePIN projects could become increasingly pivotal as the demand for decentralized solutions grows, making them a compelling option for those looking to diversify their crypto investments.
