WHAT IS: DePIN
DePINs make infrastructure like energy grids, transportation systems, and communication networks more accessible, efficient, and community-driven.
Like how play-to-earn games such as Axie Infinity, The Sandbox, and Decentraland blew up with the concept of the Metaverse in 2021, DePIN projects (short for Decentralized Physical Infrastructure Networks) are starting to carve their own lane in crypto, with a current market cap of approximately $15.1 billion.
You might’ve seen the term thrown around once or twice in a tweet, a podcast, or buried in some thread—but most people still have no clear idea what it really means. And to be fair, the concept is still new, and only a small group of people truly understands the power it holds.
To simplify it, imagine Starlink pays you for setting up a satellite dish on your roof, and just for keeping it online and letting nearby users connect through it, you're earning tokens. That’s the core idea behind DePIN. You’re getting rewarded not just for buying into a network, but for physically contributing to the infrastructure that runs it. It's real-world infrastructure meets Web3 incentives.
And projects like Helium, IoTeX, Hivemapper, and Natix Network are already showing us how this plays out. What we're seeing is a whole new sector in crypto that’s pushing boundaries and linking blockchain directly to real-world, tangible services.
David Adubiina
What is DePIN?
In plain terms, it’s about using blockchain to coordinate and reward people who help build and maintain real-world infrastructure, for example, Wi-Fi coverage, sensor networks, storage, and even energy grids.
Instead of big companies owning everything, DePIN lets regular people contribute the hardware, like routers, dashcams, or solar panels, and get paid in tokens when others use what they provide.
And while some of these services might sound digital (like data storage or internet access), they still rely on physical servers, antennas, hard drives, and all that to work. That’s the “physical” part in DePIN.
The blockchain just handles the backend, tracking who’s contributing, who’s using the service, and who should get rewarded. No middlemen, just open systems anyone can tap into.
Categories of DePIN Projects
Most DePIN projects fall into two main buckets: Physical Resource Networks (PRNs) and Digital Resource Networks (DRNs). The key difference is whether the thing you’re contributing lives in the physical world or in the digital one.
1. Physical Resource Networks (PRNs)
These are networks built around real, location-based hardware. You’re contributing something that exists in a fixed spot, like a Wi-Fi router, a dashcam, a solar panel, an EV charger, or a sensor. Since these can’t just be moved around freely, they’re tied to the geography of the network.
Helium’s wireless hotspots, Hivemapper’s dashcams, and Natix’s mobile cameras are good examples. You plug them in, leave them running, and earn tokens based on usage or data contribution.
2. Digital Resource Networks (DRNs)
DRNs are the flip side. Instead of location-tied gear, you’re offering digital resources, things like storage, computing power, or extra bandwidth. These aren’t locked to any physical spot, which makes them easier to scale and move around globally.
Projects like Filecoin, Akash, and Render fall into this group. If you’ve got unused disk space, idle GPU power, or spare internet, you can plug in and get rewarded for letting others use it.
How Do DePIN Projects Work?
At the heart of every DePIN project is a simple concept: you provide a resource, and you get a reward for it. That resource could be anything from a Wi-Fi hotspot to spare GPU power or even dashcam footage. In return, the network pays you in tokens.
But it’s not just about plugging in a device and walking away. There’s a basic flow most DePIN projects follow:
1. Set it up
You buy or install a device that works with the network—could be a router, a sensor, a dashcam, or anything else the project requires.
2. Start contributing
Once it’s running, your device starts doing its job—maybe it’s offering internet coverage, capturing visual data, providing storage, or helping with compute tasks.
3. Get verified
The network checks that your contribution is legit. This can happen through oracles, peer-to-peer validation, or smart contracts.
4. Earn rewards
If everything checks out, you get paid in tokens, usually based on things like uptime, data quality, or how much traffic your resource handled.
It’s a simple loop: the more useful your resource is, the more the network grows, and the more you can earn. Everyone wins if the system works well.
What Can DePIN Be Used For?
DePIN use cases are showing up in places you probably wouldn’t expect crypto to be involved, and you can see this in real-world sectors with real infrastructure:
Telecommunications – Helium lets people set up their own wireless hotspots and earn tokens when others connect. It’s like becoming a mini telecom provider, without needing towers or licenses.
Mapping & Mobility – Hivemapper uses dashcams to build maps from scratch. Drivers earn tokens for collecting road data—basically a decentralized, community-owned version of Google Maps.
AI & Machine Learning Data – Natix rewards users for sharing visual data from their drives. That footage helps train AI models for things like autonomous vehicles and smart city systems.
Storage & Compute – Filecoin, Render, and Akash turn spare storage and computing power into on-demand infrastructure. Think of them as decentralized alternatives to AWS, Dropbox, or Google Cloud.
Energy – Projects like Sunified are exploring tokenized solar networks, where people can contribute to energy grids and get rewarded, all without going through utility companies.
Why Does DePIN Matter?
Traditionally, a few big companies build cell towers, data centers, power grids, and everyone else just pays to use them. With DePIN, the people are the infrastructure. You contribute a piece of the network and earn from it. This allows you to be a part of it.
In places where infrastructure is lacking, especially across parts of Africa, Latin America, and Southeast Asia, this model could be a game-changer. Instead of waiting on telcos or power companies, local communities could set up their own networks, earning tokens while providing real services like internet access, storage, or energy.
The Challenges of DePIN
Despite its potential, the DePIN concept still has some hurdles to clear. This mostly comes down to the fact that building real-world infrastructure—especially through decentralized networks—isn’t as easy as spinning up a smart contract.
You're dealing with hardware, logistics, people gaming the system, and even governments watching closely. So, while the model is promising, there are still some rough edges to smooth out:
- Hardware Costs
Getting started often means buying routers, dashcams, or sensors, which isn’t cheap. That upfront cost can be a blocker, especially in places where DePIN has the most potential.
- Low Liquidity
Many DePIN tokens are still small-cap. Their markets aren’t very liquid, and price swings can be wild. That makes it harder for contributors to turn rewards into stable income.
- Data Integrity
There’s always the risk of bad actors gaming the system—faking GPS locations, uploading junk data, or spoofing usage just to earn tokens. Building reliable verification systems is still a work in progress.
- Network Bootstrapping
These systems need both contributors who provide the infrastructure and users who consume it to work. If one side lags behind, the whole thing stalls.
- Regulatory Gray Areas
Some DePINs—especially those in telecom, mobility, or surveillance often run into legal or licensing issues. Mainly because the Government hasn’t fully figured out how to classify or regulate them yet.
David Adubiina
Conclusion
While the concept of decentralized physical infrastructure still has bumps to iron out, DePIN is one of the clearest signs that crypto is starting to move beyond just tokens and trading, and into real-world utility.
We’re seeing networks being built from the ground up by everyday people—Wi-Fi powered by communities, maps driven by dashcams, storage and compute shared across borders. And contributors aren’t just passive users; they own a stake in what they help create.
Yes, the tech is still young, and the risks are real, but DePIN offers a working example of how crypto can be tied to services people use. If Web3 is going to matter long-term, it has to show up in the real world. DePIN might be the start of that.
