Decentralized Infrastructure Networks: Revolutionizing Internet Control and Digital Commerce
Summary:
Decentralized infrastructure networks (DePINs) are offering a new, user-centred model of Internet control, challenging the dominance of major corporations. Over 1000 businesses are harnessing DePIN to compete against the big players in sectors with high barriers to entry. Being crowdsourced and capital-light, DePIN projects like Filecoin and Akash network could disrupt traditional models of digital commerce, allowing people to monetize their resources and providing services like storage and compute power at a fraction of traditional costs. This innovation could promote broader internet usage and lead to significant societal benefits.
Internet control is chiefly under the power of a few corporations that not only enjoy sizable scale benefits but also gain protection via regulations. Furnishing crucial internet infrastructure such as telecommunication services and digital assets like compute power, these dominant firms have curtailed competition within their sectors. Consequently, prices have soared whilst consumer choice has dwindled, bringing detriment to end users.
A fresh set of platforms known as decentralised infrastructure networks (DePIN) are looking to revolutionise this by giving internet control back to its key beneficiaries: the users. Public blockchains underpin these networks, which could potentially enhance the disruptive innovations of certain businesses - think Airbnb - by granting people the authority to oversee, monetise and develop the infrastructure around them. To put it plainly, DePIN enables individuals to offer their resources (like electricity and the internet connection) in exchange for small payments.
DePINs are breaking new ground in making it easier for startups to thrive in sectors that typically pose high entry barriers. Without the need to hire people and procure infrastructure, companies can instead use crowdsourcing for their capital-intensive operations. In this respect, DePIN transforms large initial fixed costs into more manageable long-term variable costs.
Meanwhile, DePIN companies - unlike firms like Uber - leverage tokens to enhance their models by remunerating contributors with shares, as well as cash earnings. By stimulating internet-connected populations, DePINs propose an innovative network structure that draws on variable costs to deliver crucial consumer value.
Currently, over a thousand companies leverage DePINs to challenge established players. Filecoin is the first to scale, providing verification, storage, and retrieval for third parties wishing to deliver cloud services to businesses. By joining the Filecoin network, businesses with spare storage capacities can feasibly compete with Amazon's centralised scale in cost, besides ensuring high safety and access standards.
DePIN organisations are also beginning to offer digital assets like computing power and bandwidth. For instance, the Akash network affords people owning GPUs the ability to rent out resources to developers in need of computing power, similar in operation to Filecoin. Contrarily, Akash lays more emphasis on compute power for AI model training use cases.
The DePIN business model distinctly disrupts the conventional models created by firms offering digital assets. DePIN projects, through crowdsourcing supply without worrying about recovering initial costs, are perfectly positioned to provide pay-as-you-go IAAS models.
While Mainstream adoption is yet to take place, these DePIN projects have the potential to challenge large incumbents on pricing. Case in point, Filecoin already delivers storage services at prices significantly lower than Amazon's cloud services.
Even though crowdsourced infrastructure is in its infancy, DePIN provides a viable alternative to tackling dominant corporations without resorting to central financing. In a world increasingly dependent on the internet for learning, living, and development, it's plausible that Filecoin's model, if it scales successfully, could serve as an example of how decanting production means to the workers can simply generate considerable economic value. By cutting down digital asset prices, DePINs foster greater internet service usage with less obstructions to entry, paving the way for extensive societal benefit.
Published At
5/31/2024 12:24:02 AM
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