Introduction to DePIN

What is DePIN?

DePIN is one of the key potential sources of future income for us all.

It is the idea that individuals contribute their device (phone or computer) to a wider network. It also enables something long discussed but never fully realised - the ability for humans to monetise their data.

DePIN stands for Decentralised Physical Infrastructure and usually looks like this:

• Connecting your computer to a network and allowing spare processing power to be used by that network.

• Using your phone or other device to collect data and contribute that data to a wider network.

This is a continuum on our journey from centralised to decentralised platforms and technology enabled largely by blockchain. So what does that mean?

• Google maps was created and maintained by google (a centralised company with profits going to that company). Now various DePIN initiatives allow anyone in the world with a phone to contribute to that mapping process (and be rewarded for it).

• Graphic Processing Units (GPUs) typically sit inside your computer (centralised) and allow for high definition gaming, artwork and machine learning. DePIN projects such as Render Network allow idle GPUs across the globe to be pooled and used for processing (decentralised).

Some projects require you to buy a device (like a sensor), while others allow you to use your phone or computer and just download an application. I’m focusing on the later for this article, because these are the easiest to get started with and therefore more accessible to first timers.

I’m currently experimenting with 3 examples of DePIN which I want to introduce here to give an overview of the topic. All of them are at early stages and have not released their digital token yet, so I am earning points that will be converted to tokens with a monetary value. Until that happens I won’t write in depth on the individual platforms - until the token is launched and value understood these remain unproven but you will see they all serve as an example of the DePIN concept.

1. Silencio

Silencio, the global network to measure noise pollution, puts an app in your hands to help measure noise levels wherever you are. It’s utterly simple to use and points are awarded instantly.

You are given the choice to do an ‘Open Measurement’ (best for when you are at home or walking around) and a ‘Venue Check-in’ (which you do when in a public building like a restaurant, office or shopping mall).

You earn Noise Coins according to:

• 1 Minute Measured

• 1 Hexagon Covered

• 1 Hexagon Discovered (ie. you are the first person to record there)

• 1 Venue Check-in

• Referrals

I am measuring noise levels while writing this article (image below) and a single Open Measurement is 30 minutes max.

This is a very interesting early DePIN concept - building a community driven dataset without the need for expensive hardware with the hope that you can monetise the data once you have sufficient scale. As I said, when I wrote about Sweat Economy, in theory you can reward anything you can measure with a phone.

The founding team is led by the Messerer brothers who had experience in other early DePIN projects (like Helium mobile) and who were more attuned to the issue of noise pollution due to their father’s hearing loss. They plan to sell the data to city planners, property developers, the hospitality industry, well-being industry, insurance and academics.

2. Grass

Grass belongs in the first category I mentioned above - using spare capacity from your phone or computer. According to the Grass website, ‘by installing the Grass web extension, the application will automatically sell unused internet to AI companies, who use it to scrape the internet and train their models.’

I’ve been using this for ~2 months and like Silencio, the process is very simple. You just download a browser extention and set it up to go, then it automatically records your uptime and daily points (my screenshot is below).

The most simple way to think of this is your internet contract - you buy a certain amount of data each month and for most users, you won’t use all of that data - so Grass will automatically allocate spare data to others.

Anything that asks you connect your computer to a network should raise red flags both in terms of data safety and hacking risk. The level of transparency behind Grass isn’t fantastic so I am proceeding with this one with my eyes open, knowing the following:

• The team behind Grass is something call Wynd Labs which does have a website but doesn’t publicly list their team. However, the team can be found on linkedin.

• Their FAQs state that ‘Grass does not access or utilize your personal data in any way. The network is used to access public websites, and has nothing to do with the data on your computer’.

• Some articles exist explaining why Grass is safe to use, but a closer looks shows they are mainly rehashing Grass’ own materials rather than interviewing the team or obtaining a 3rd party view.

• The team did raise USD$3.5m in capital in late 2023 from recognised investors like Polychain Capital indicating the project is real (although even the announcement on their own website only mentioned the founders, without anyone specifically named which I find unusual).

So the jury is out on whether this project is long term and legitimate, and I will try to find out more, but in the meantime it serves as example of the concept of DePIN and how in theory you can monetise unused assets.

3. NATIX

The 3rd DePIN project I’m trialling is called NATIX - a global mapping network of smart cameras. To use Natix you download their app, then record video footage while you drive.

If you think about visual data cross the world, it is currently held by a plethora of disaggretated public and private devices: building CCTVs, city / school / traffic CCTVs, individuals’ phones, dashcams etc. These are owned separately, and recorded for separate purposes. I might record for activity at the front of my house, while my neighbour records for theirs and the library down the road for theirs. At a global scale, the world is being recorded but that scale is not being leveraged.

Well, NATIX promises to fix this, becoming the ‘fastest, cheapest and most scalable way to crowdsource live data and create a digital twin of our environments’. They currently have almost 100,000 drivers registered, but imagine if they could truly achieve scale with millions of devices generating a live picture of our physical space.

NATIX actually calls out the unfair playing field when it comes to data, citing a Morgan Stanley paper which estimates Google Maps will earn more than USD$11 billion in revenue in 2023 and that people lose about $500 annually by voluntarily providing personal data to tech companies.

I’ve been using NATIX each time I drive and earning points (my screenshot is above showing 562 points earned). Like Silencio and Grass, it is very easy to use, does not require a special device and earning points works seemlessly (again is pre-token launch). However, I am not a big driver, only taking the car out 3-4 times a week and with no work commute, so I’m never going to be a top earner.

NATIX is a German business founded in 2020 and looks to have strong backing and partners, with companies like E.ON and Deutsche Telekom listed on their website.

If you have read my articles on the Axie Infinity story, BULB, Sweat Economy and Karate Combat, you will see that together with DePIN a picture is emerging of a different future. One where many of our activities are tracked, but now are rewarded. Many of these projects will fail to get sufficient scale, or will be superceded, but the overarching trend is the key point.

If you have a single source of income it might be time to test some of these platforms out, find out which ones work for you and take a long term view that regardless of the short-term pay out, earning digital tokens will be part of our future in some way or another.

Jack

IN