The reason decentralised projects are brought from online to the real world is because of the concept of DEPIN.
DePin stands for decentralised physical infrastructure networks. It is applied to the integration of blockchains. It transforms the objects with physical infrastructure. The blockchains approach allows the users to create a fully clear, autonomous and open database that is protected from fakeness due to its decentralised nature.
It is automatically present in some smart contracts. Blockchain technology helps the user to easily handle the operation of the systems, control every step, and instantly provide reporting with the entire evidentiary base. This is free to use, the customer does not need to pay any fees to use it.
Examples of DePIN
The Filecoin– the DePIN concept was first implemented by Filecoin.
The implementation of the project is mentioned below – to get the free memory for the device, the owner can lease out the unused space. For example, Tony has 40GB of free memory on his computer, he can rent it out to a user who needs storage space. Due to the privacy issue, the developers warn against encrypting it.
As it will help to protect the data and the owner of the physical storage device will not be able to spy on exactly what is in the tenant’s files. The tenant can use FIL cryptocurrency for the payment to the owner of the memory.
And the level of payment is decided by the owners. And it helps to maintain fair prices in the market. The whole system is managed by the Filecoin blockchain. There are other examples of how blockchain systems can manage physical infrastructure.
Helium → helium is a decentralised blockchain system
That allows smart devices to access the internet by connecting them to a network of gadgets belonging to project participants.
Render→ render is a blockchain network where users can share computer power for rendering.
Nunet → nunet is a universal decentralized network through which you can share the computing power of your devices.
Over 650 organizations such as healthcare, geolocation services, etc., were registered in the market as recorded at the end of 2023. It has a market capitalization of over $20 billion.
Coins are needed to reward users and pay for their services in DePIN projects.
Advantages of DePIN
- Information is protected from forgery.
- Such systems are transparent and fair
- Charges can be reduced through process automation.
- Errors can be eliminated through automation
- The payment system can be automated
Disadvantages of DePIN
- Regular changes in the value of cryptocurrency can negatively impact the value of tokens in which a deepened project participant receives rewards.
- Regulators may have questions about such projects
- Risks of programming errors that could lead to fatal consequences for the system cannot be ruled out.
Conclusion
DePIN has a bright future ahead. It is economically efficient. It can provide various services to the user and the user can capitalize by purchasing cryptocurrency from promising projects.
