What is DePIN? Exploring the decentralized infrastructure network that's changing the world

Our modern infrastructure largely depends on centralized companies and organizations. But what if there’s another way? DePIN—short for Decentralized Physical Infrastructure Network—is opening a new path for building and operating essential services. Instead of relying on giant corporations, DePIN invites communities of users to become active investors in the infrastructure they use every day.

DePIN – The Shift in Basic Infrastructure

According to experts at Messari, the DePIN ecosystem has experienced remarkable growth. In 2023, over 650 projects emerged across six main sectors: computing (250 projects), artificial intelligence (200), wireless (100), sensors (50), energy (50), and services (25). The total market capitalization of DePIN tokens with liquidity has surpassed $20 billion USD, while annual blockchain revenue is estimated at around $15 million.

But DePIN is more than just numbers. It represents a philosophical shift in how we view infrastructure. Instead of a few companies controlling global infrastructure, DePIN proposes a model where the community—those who actually use and maintain the systems—own and are fairly rewarded. It’s a move from centralization to decentralization, from monopoly to collaboration.

How DePIN Works: Blockchain, Tokens, and Community

DePIN operates through a sophisticated mechanism: combining blockchain technology with token-based incentives. Its core is simple—networks use tokens to incentivize deployment and operation of physical infrastructure.

This approach fundamentally differs from traditional business models. Instead of a top-down hierarchical structure, DePIN builds from the ground up, driven by community motivation. This means the network can scale at lower costs—no need to build centralized infrastructure, but rather leverage existing community resources.

Messari calls this the “DePIN Flywheel”—a concept describing how one component’s progress drives others, creating momentum. They estimate this flywheel could contribute over $10 trillion to global GDP in the next decade, and $100 trillion in the following one.

Five Pillars of the DePIN Ecosystem

To understand how DePIN functions, we need to analyze five core components:

1. Physical Hardware: The foundation of every DePIN—ranging from WiFi access points, wireless networks, routers, to servers, generators, telecom equipment, even solar panels. These are not abstract theories but real devices installed at actual locations.

2. Hardware Operators: Individuals, communities, or businesses responsible for deploying and maintaining this hardware. While tokens are used to incentivize them, motivations also include technical expertise, initial costs, and other practical challenges.

3. Distributed Ledger Technology: Blockchain, supported by smart contracts, plays a central role. It ensures transparency, traceability, and security across the network—key factors for user trust.

4. Token-Based Incentives: This is the “explosive” element of DePIN. Those contributing infrastructure—such as owning an access point—are rewarded with blockchain tokens. This creates a self-sustaining loop: the network grows because participants are recognized for their contributions.

5. End Users: They are the actual service consumers who pay with cryptocurrencies. By integrating blockchain, smart contracts, and IoT devices, DePIN creates a robust environment where infrastructure assets are managed efficiently.

DePIN on Blockchains: Solana and Ethereum Leading

While Ethereum is often seen as the primary blockchain for DePIN projects, Solana is rapidly gaining momentum. Why? Messari suggests that “integrated infrastructure and developer communities focused on Solana’s performance” are attracting DePIN projects at all stages. High-performance blockchains can enhance accessibility through higher transaction throughput.

Currently, Solana is trading at around $80.49, reflecting ongoing market interest in high-performance Layer 1 infrastructure.

Key DePIN Projects in 2024–2026

Helium (HNT): Decentralized Mobile Network

Helium Network is a success story in DePIN. In April 2023, Helium made a strategic shift—from an independent Layer 1 blockchain to Solana—to leverage scalability and lower costs. Today, it operates as a decentralized LoRaWAN network, called “The People’s Network,” playing a vital role in IoT connectivity.

Instead of relying on traditional telecom providers, Helium empowers communities through user-owned access points. The wireless network enables automatic expansion of internet and mobile coverage. Those who buy and operate these access points are rewarded with HNT tokens.

Currently, Helium operates access points in over 170 countries, providing 5G services in select U.S. cities. In 2023, Helium Mobile was launched, allowing users to manage mobile networks via token incentives.

In December 2023, Helium Mobile announced a $20/month phone plan with unlimited data, calls, and texts, supported by community-owned 5G access points. Compared to the average American’s $144 monthly mobile bill, Helium Mobile aims to make connectivity accessible to all. Subscribers share nodes and are rewarded with MOBILE tokens on the Solana network, which can be used to pay for services. HNT is currently trading at about $1.39.

Filecoin (FIL): Decentralized Data Storage Market

As of January 2024, Filecoin is the largest DePIN project by market cap. Its peer-to-peer storage network incentivized with cryptocurrency enhances traditional storage models, allowing individuals and businesses to rent unused storage space securely and in a decentralized manner.

Filecoin functions as a decentralized marketplace for storage services, compensating providers with FIL tokens while users pay for the capacity they need. Since its launch in 2020, Filecoin has directly competed with Web2 cloud giants like Google Cloud and Amazon Web Services, but with a key difference—offering a distributed, economically incentivized, secure storage solution.

By connecting those needing storage with those with excess disk space, Filecoin creates a competitive, decentralized market with cost advantages and a focus on decentralization. FIL is currently trading at about $0.91.

Render (RNDR): Decentralized GPU Rendering Service

Render acts as a peer-to-peer graphics processing unit (GPU) provider, connecting organizations seeking rendering services for images and animations with GPU owners who have idle resources. Providers are compensated with RNDR tokens, creating an ecosystem where users benefit from decentralized rendering.

This model ensures efficient GPU resource utilization and promotes a distributed network for high-performance rendering. Render’s approach challenges traditional centralized rendering solutions, embodying core DePIN principles by creating an open, community-driven marketplace for computing resources.

In November 2023, Render upgraded from Ethereum to Solana, enabling more efficient streaming and flexible NFT features. In December 2023, Render implemented a Burn-and-Mint Equilibrium (BME) model, allowing the network to price services consistently based on supply and demand.

Other Notable DePIN Projects

Beyond these three, the DePIN ecosystem includes other key players:

• IoTeX (IOTX): Focused on IoT solutions
• Livepeer (LPT): Decentralized video encoding network, trading at $2.26
• Theta Network (THETA): Decentralized video distribution, at $0.19
• Akash (AKT): Decentralized cloud computing marketplace, at $0.31

Future Outlook: Challenges and Opportunities for DePIN

The potential of DePIN is immense, signaling a fundamental shift in how we deploy, operate, and utilize physical infrastructure. Its benefits include cost-effective community resource mobilization, empowering local communities, and promoting technological decentralization. These factors pave the way for a future where individuals actively shape the technological landscape.

Messari predicts that the most significant growth of DePIN will occur in Asia, where many leading projects are expected to emerge between 2024 and 2025. Innovations such as ZK technology, meme coins, blockchain AI, and blockchain gaming are forecasted to drive expansion.

However, this journey faces hurdles. Potential challenges include regulatory uncertainty, scalability concerns, and the need for broader adoption. Addressing these issues will be key to sustainable growth and widespread acceptance of DePIN technologies.

DePIN represents a step back to rethink how we organize essential services. With the potential to revolutionize industries and empower individuals, DePIN could play a crucial role in the future of infrastructure and the broader crypto space.