Crypto Trends 2023: Decentralized Physical Infrastructure Networks (DePIN)

Jun 14, 2023

Over the last decade, several innovative companies - with Airbnb and Uber leading the pack - have created new internet-enabled marketplaces. These trailblazing platforms introduced the world to a fresh take on commerce: a sharing economy built around decentralization.

This innovative wave of business models dramatically reshaped how individuals interact with services built around physical infrastructure such as cars and homes. Yet, intriguingly, the sharing economy has not been as widely applied in other areas of physical infrastructure, especially those at the heart of the digital economy, like telecommunications and data warehouses.

Nevertheless, a shift has been brewing in recent years. The advent of a new generation of blockchain protocols has been quietly but irrevocably redefining how these physical infrastructure networks can be built and scaled to serve their end users. This transformative technology paves the way for a future replete with previously unimaginable possibilities. And so, with this technological revolution well underway, we find ourselves on the brink of an exciting new world. Welcome to the era of DePIN!

In this piece, we'll explore what DePIN is, why it's important, its various categories, notable examples of DePIN companies, and the impact it could have on our future.

I. What is DePIN?

Introducing DePIN – an acronym for Decentralized Physical Infrastructure. This innovative approach is revolutionizing how we create and manage physical infrastructure and hardware networks. Just as Airbnb and Uber transformed their respective industries, DePIN aims to do the same, but with a twist - it's building the future of digital-focused physical infrastructure on the solid foundation of blockchain technology.

DePIN projects are much more than a fancy name. They operate on a unique premise: the use of tokenized rewards to inspire, motivate, and coordinate individuals and small businesses. The goal? To encourage them to deploy and operate physical infrastructure networks that range from telecommunications to data warehouses and data sensors. In this model, tokenized rewards serve as a compelling incentive, driving participants to actively shape the infrastructure landscape.

But the innovation doesn't stop there. Once these networks are up and running, they're not reserved for the exclusive use of large corporations or government entities. Instead, they're offered to everyday consumers. And how do these consumers gain access to these services? Through network tokens. This method of access is a masterstroke in itself - it integrates perfectly with the decentralized nature of the DePIN projects, creating a holistic, circular economy that benefits all parties involved.

The real genius of DePIN lies in its ability to turn the traditional infrastructure model on its head. It's like envisioning a blockchain-based Airbnb or Uber but for physical infrastructure with a digital focus. By decentralizing access and control, DePIN projects create a more resilient, efficient, and democratized infrastructure system.

So, whether you're exploring telecommunication networks, probing into the depths of data warehouses, or harnessing the potential of data sensors, the DePIN approach offers a tantalizing glimpse into the future of infrastructure. It’s a future where everyone can participate and benefit and where the age-old, top-down approach is replaced by a decentralized, user-centric model. Clearly, the DePIN revolution is not just a fleeting trend – it's the dawn of a new infrastructure development and management era.

II. Who Benefits from DePIN?

So who stands to gain from the DePin revolution? The answer is simple: everyone. From network builders and providers to consumers, the benefits of DePin are broad and impactful.

1. Network Builders
Turning our attention first to the Network Builders, they stand to benefit significantly from the arrival of decentralized physical infrastructure via DePIN. One salient example lies in how DePIN leverages the capabilities of crowdsourcing, acting as a catalyst to accelerate the speed of infrastructure deployment. In practical terms, this means that a Network Builder could conceivably establish an expansive network in significantly less time than traditional methods would permit, essentially turbocharging their deployment process.

Moreover, the decentralized core of DePIN fosters an unprecedented environment for unrestrained global scaling. For instance, with remarkable ease, a Network Builder can now extend their network's footprint from an isolated rural hamlet in the American Midwest to the bustling city centers of Asia. This expansion requires no extensive hoops to jump through or complex procedures to follow, previously inherent in such transnational growth. The result is a seamless and efficient bridging of vast geographical divides.

Finally, the economic benefits that DePIN brings to the table cannot be overstated. This innovative system effectively trims down the costs associated with traditional infrastructure projects, eliminating many of the overheads that were once considered inevitable. For instance, Network Builders can now circumvent the hefty expense of securing and maintaining physical locations for network operations centers, as the decentralized nature of DePIN makes these largely unnecessary. Therefore, DePIN offers an inherently more cost-effective solution that redefines the economics of network building.

2. Providers
Now, let's shift our focus to Providers—the individuals or small-scale businesses tasked with operating and maintaining the physical networks. The advent of decentralized physical infrastructure via DePIN introduces many benefits for them. One noteworthy example lies in the tokenized incentive system that DePIN utilizes, which facilitates a frictionless reward process. Imagine a small internet service provider in a rural town. With DePIN's model, this provider would have direct ownership and control over the network, with rewards directly correlated to the service provided—without any need for complex legal agreements or third-party validations.

Furthermore, this system opens avenues for enhanced income potential by phasing out superfluous intermediaries fees. To illustrate this, let's consider a local telecom provider. Under DePIN's model, the provider would receive a more substantial portion of the service fee without any cuts taken by intermediaries. This leads to higher earnings and a more gratifying business experience.

The cherry on top is the hassle-free payment solution that comes with DePIN. This feature eradicates the need for traditional financial intermediaries, leading to a more efficient and seamless transaction process. So whether it's a small startup maintaining a network of charging stations for electric vehicles or a local entrepreneur running a community internet service, payments for services are streamlined, simple, and more profitable. The result is a more rewarding and satisfying experience for providers in the DePIN ecosystem.

3. Consumers
Finally, let's not forget the Consumers—the primary beneficiaries of the services provided by these networks. With the advent of decentralized physical infrastructure via DePIN, consumers are presented with a vast increase in service accessibility. To put it in real terms, imagine a remote rural town in middle America, often overlooked by traditional infrastructure providers, now having uninterrupted access to the digital-focused physical infrastructure services it requires. This widespread access democratizes digital services and enables an unprecedented number of people to plug into the services they need.

Furthermore, DePIN brings affordability to the table with its 'pay-as-you-go' model, a stark departure from traditional flat-rate pricing. Suppose you're a freelance graphic designer working intermittently from home and using data. With DePIN, you only pay for the data you consume, eliminating the financial strain of a hefty monthly bill. This pricing model, paired with the absence of superfluous intermediary costs, results in a more affordable service for consumers.

Finally, the inherent neutrality, reliability, and transparency of the DePIN network offer a significant advantage. Consumers can rest easy knowing that their digital services are reliable and straightforward and delivered within a fair and impartial framework. This offers consumers both peace of mind and renewed confidence in the services they're utilizing.

III. Four Main DePIN Categories

Diving deeper into the DePIN universe, there are four main categories that it spans across, each bringing unique benefits and solutions to the table.

1. Server Networks / Cloud Storage Networks:

First, we have Server Networks and Cloud Storage Networks. In a world where data is king, these decentralized server and storage networks offer a fresh perspective. They provide secure and resilient data storage, with users only paying for the exact amount of storage they utilize. In traditional centralized storage services, all data is housed in a central server or data center. While this might seem efficient, it creates a single point of failure. If the central server is compromised, whether through a cyberattack, hardware failure, or even a natural disaster, all data stored there is at risk. Additionally, users often pay for predefined storage packages, which can lead to paying for unutilized space.

The decentralized approach of DePIN, on the other hand, distributes data across multiple nodes or storage points in the network. Each piece of data is split into smaller parts, each encrypted for security and then spread across the network. This means that even if one node is compromised, the overall data remains secure and accessible as the other nodes maintain copies. This decentralized architecture also inherently guards against data loss, making the network highly resilient.

This model stands as a robust alternative to traditional centralized storage services, which have been marred by security breaches and inflated costs in the past.

2. Wireless Networks (5G, Wifi):

As we progress in our exploration of the DePIN universe, we find ourselves amidst the vast expanse of Wireless Networks, encompassing technologies like 5G and WiFi. The aim here is not just to merely provide coverage and connectivity but to enhance and democratize it through the use of a decentralized network of hotspots.

Now, let's delve deeper into the mechanics of how traditional Internet Service Providers (ISPs) work and contrast that with the revolutionary concept of decentralized hotspots that underpin DePIN's approach.

Conventional ISPs operate on a centralized model, where large-scale infrastructures like data centers, sprawling networks of wired connections (think fiber-optic cables), and towering cell towers form the backbone of the service. These central hubs are the heart from where the internet signal pulses out, reaching individual homes and businesses. However, this model often leaves rural or remote areas in a connectivity void. The rationale? The high costs and logistical hurdles of deploying such infrastructure in low-population regions often outweigh the potential returns for these companies.

Now, imagine a different scenario, a new paradigm of connectivity — the world of decentralized hotspots. Here, the internet service isn't a pulsating heart but rather a humming network spread out across multiple individual hotspots. Each hotspot, owned and managed by individual users or small businesses, operates like a personal mini-cell tower or a Wi-Fi router, providing internet access to its immediate surroundings. By utilizing hotspots over the traditional infrastructure model, we can visualize a future where rural areas and other smaller types of communities can have equal and effective access to the Internet.

3. Sensor Networks:

Continuing our journey into the DePIN universe, we find ourselves in the sphere of Sensor Networks. These networks are essentially composed of interconnected devices, each designed to monitor and collect specific data from their environment. Imagine a team of digital scouts, each assigned to watch over a specific element like temperature, humidity, or movement, diligently reporting their findings for collective analysis and use.

Let's delve into the realm of agriculture for a more tangible example. In a traditional agricultural setting, a farmer might need to manually check various factors like soil moisture, temperature, or weather conditions to determine the optimal time for planting or watering crops. This process can be labor-intensive, time-consuming, and subject to human error.

However, with a sensor network in place, a multitude of sensors are spread across the field, each monitoring these crucial factors continuously and in real time. They provide precise, reliable data which can be used to make informed decisions, ultimately leading to better crop yields and more efficient farming practices.

Now, when we talk about DePIN Sensor Networks, we're discussing a similar system but with a key difference - decentralization. Unlike traditional sensor networks, which might rely on a centralized system for data storage and analysis, DePIN Sensor Networks distribute the data across a decentralized network. This approach offers secure and transparent storage of sensor data, ensuring its integrity and accessibility.

4. Energy Networks:

Finally, we arrive at the realm of Energy Networks. These decentralized networks represent a radical shift in how we approach the sharing and trading of energy resources, including solar power, within a community.

To understand the transformation at hand, let's look at how people are currently monetizing their solar power without blockchain technology. Take the concept of 'net metering,' for instance. This is a system where solar panels or other renewable energy generators are connected to a public-utility power grid. The surplus power that households or businesses generate is fed back into the grid, and they're credited for this excess power, effectively lowering their utility bills.

While this traditional system has its benefits, it also has its limitations. It often depends on the policies of utility companies, and it doesn't allow individuals to directly sell or trade their excess energy with others in their community.

Enter DePIN Energy Networks. Through the decentralization of the energy network, DePIN enables users to capitalize on their excess energy production in a direct and straightforward manner. This revolutionary approach not only encourages more prudent energy consumption but also diminishes the dependency on conventional energy providers.

Consider this: A household with solar panels installed on their roof might produce more energy than they consume, especially during peak sun hours. With DePIN Energy Networks, this surplus energy doesn't go to waste or back into the grid at a low buy-back rate. Instead, they can now directly trade or sell this excess energy to their neighbors or local community members. This transaction forms a localized energy marketplace, fostering a community-centric approach to energy distribution.

In essence, this system returns power—both in the literal sense of energy and in the figurative sense of control—to the people. It's a community-driven approach to energy management where everyone wins—households and businesses get to monetize their surplus energy, consumers get access to potentially cheaper energy, and the community as a whole move towards more sustainable and efficient energy consumption practices.

The DePIN approach to energy networks could offer a more democratic, efficient, and potentially profitable model for energy generation and consumption. It's a testament to the transformative potential of decentralized physical infrastructure, paving the way for a future where communities are more self-reliant, sustainable, and economically empowered.

IV. Spotlight: Three Prominent DePIN Companies

1. Filecoin (Decentralized Storage):

Filecoin is a peer-to-peer (P2P) storage network that aims to create a decentralized market for storage space, rivaling established providers on price and decentralization. By using Filecoin, users can securely store their data while providers receive Filecoin tokens for offering storage space.  

This stands in contrast to centralized providers like Amazon Web Services, which have faced data security issues and breaches in the past.

2. Helium (Wireless Network):

Helium is a network for wireless infrastructure that provides coverage for Internet of Things wireless connections and 5G. Users can buy Helium hotspots and earn the native HNT token for providing wireless coverage. With over 900,000 hotspots, Helium aims to improve network coverage in underserved areas, offering an alternative to traditional telecom companies like AT&T and Verizon.

3. DIMO (Sensor Network):

The DIMO Network enables users to monetize their mobility data by connecting their cars to a hardware device. This data can be used by automotive finance, insurance, maintenance, and other sectors. Users earn the native DIMO token while optimizing their vehicle health and sale price. This innovative approach helps reduce vehicle financing costs and promotes data monetization.

V. Three Key Takeaways About DePIN

As DePIN continues to gain traction, it has the potential to alter the landscape of physical infrastructure significantly. By leveraging the power of decentralization, blockchain technology, and tokenized rewards, DePIN networks can provide more secure, transparent, and accessible solutions for infrastructure deployment and operation.

1. Democratization of physical infrastructure — One of the most significant impacts of DePIN is the democratization of physical infrastructure. By allowing individuals and small businesses to participate in the deployment and operation of infrastructure networks, DePIN can create more equitable access to essential services and resources. This, in turn, can spur innovation and drive economic growth, especially in underserved areas where traditional infrastructure providers have struggled to make a significant impact.

2. Efficient & secure infrastructure solutions — DePIN networks can lead to more efficient and sustainable infrastructure solutions. By leveraging the power of decentralization, networks can optimize resource allocation and reduce waste, leading to more environmentally friendly outcomes. Additionally, the transparent nature of blockchain technology ensures that data and resources within DePIN networks are managed with a high level of integrity and accountability.

3. Community and ownership — Lastly, the tokenized reward system used in DePIN networks can help foster a strong sense of community and ownership among network participants. By offering tangible incentives for individuals to contribute to the network, DePIN can encourage widespread participation and collaboration, leading to more robust and resilient infrastructure networks.


DePIN is a groundbreaking concept that has the potential to revolutionize the way we approach physical infrastructure. By leveraging blockchain technology, decentralized networks, and tokenized rewards, DePIN networks can provide more secure, transparent, and accessible solutions for infrastructure deployment and operation. As the world continues to adopt blockchain technology and digital currencies, DePIN networks are poised to play a crucial role in shaping the future of physical infrastructure.

At CoinList, we’re excited to support DePIN projects across every stage of their life cycle.  To learn more about how we can best support your crypto project, reach out to us today »

Legal notice

This blog post is being distributed by Amalgamated Token Services Inc., dba “CoinList,” or one of its subsidiaries. This blog post and use of the CoinList website is subject to certain disclosures, restrictions and risks, available here. The products, services, information and/or materials referenced may not be available for all individuals or residents of certain jurisdictions.

Great! You've successfully subscribed.
Great! Next, complete checkout for full access.
Welcome back! You've successfully signed in.
Success! Your account is fully activated, you now have access to all content.