Looking back at the crypto market over the past year, many participants were surprised. At the end of 2022, the market fell into despair after the FTX crash, and with the release of leverage and panic, it began to bottom**. At that time, everyone thought that it was just the ** in the deep bear, but they didn't expect that Bitcoin could break through the 50,000 mark in just one year, and many altcoins were more than ten times or even dozens of times from the bottom.
I'm afraid that devout crypto believers would not have imagined that the market would come so violently.
In this process, the market has also given birth to many hot topics and tracks, and the outbreak of hot spots has provided the best impetus for the market, such as inscriptions, RWA, Bitcoin ETFs, MEMEs, modularization and so on. Especially since the end of last year, the inscription has become the most concerned depin, if the inscription is the carnival of Asia, then the depin is the "darling" of European and American capital.
According to Coingecko, as of February 2024, the size of liquid assets in the Depin sector has exceeded $16 billion, and the market size of the Messari Report**Depin is expected to reach 3$5 trillion scale.
**Information from coingecko, data as of 20242
DEPIN is short for Decentralized Physical Infrastructure Networks. To put it simply, DEPIN is based on the blockchain and uses token incentives to allow users to participate in the construction of the network and the large-scale deployment of hardware, thus forming an infrastructure network.
Many people will wonder if these concepts have been working on projects for a long time. Such as Filecoin, Helium, Arwe**E, Theta, etc., is it the packaging concept fried cold rice this time? Some people even compare the IMO (First Mining Machine Release) concept and PI projects with CX properties a few years ago with the current DEPIN, and question DEPIN is the so-called packaging concept to sell mining machines.
The opportunity of the Depin track
Compared to the inscription track, which is driven by the consensus of the first from the bottom up, the construction of infrastructure networks is usually top-down, and the production and participation of hardware means that the DEPIN project needs sufficient upfront capital support to ensure that the hardware can be rolled more extensively, so as to establish a strong network coverage, which requires a lot of money and long-term investment.
Compared to traditional infrastructure providers, native web3 companies often don't have as much capital to continue building. In the early days, the team could only attract users to participate in the speculation by "issuing coins" and "selling mining machines", obtain funds, and then use the funds to pull the price of coins.
If it is in a bull market cycle, this method can be a positive cycle, the mining machine and the currency price will continue**, and the participants will have higher returns and attract more people to participate. However, the crypto market bull and bear changes quickly, and in the last round of bull market, many project parties encountered a bear market before they sold much, facing the dilemma of leaving a bunch of chips and mining machines in their hands, and unable to ship without liquidity.
Many participants are also faced with the equipment in their hands digging every day, not to mention the cost of electricity, which can only produce a bunch of useless "points". Therefore, most of the users who participated in such projects before the last bull market did not get a good return, and even those who participated late even lost their money. This also led to many "people who came over" scoffing at Depin and giving the definition of Ponzi **.
There is an old saying that "one step ahead is a pioneer, and three steps ahead is a martyr". There is no doubt that without the blessing of capital, there is no hematopoietic ability, the infrastructure is almost equal to zero, and the project is only supported by token speculation and encounters a bear market, and these project parties and participants have become "martyrs".
I think the popularity of DEPIN this time is mainly due to two points, the improvement of fundamentals and the focus of capital. At the end of the day, the timing is right.
DEPIN has gradually started to land and have practical applications from the "speculation concept selling mining machine", and its value has gradually been recognized by the market. The most representative project, Helium, has been successfully transformed, deeply bound to Solana, and Helium Mobile, which has recently launched a $20 unlimited call data in the United States, has been well received. RNDR, a decentralized GPU rendering network, has also partnered with giants such as Apple, Microsoft, Google, Nvidia, and Disney. The improvement in fundamentals means that the track is no longer just a castle in the air.
Any hype of new technologies is inseparable from the impetus of capital. Before 2022, there was no overall definition of the entire DEPIN track, and the classification of projects was decentralized Internet of Things, decentralized storage, decentralized computing, etc. It wasn't until the end of 2022 that Messari officially proposed the concept of Depin through voting, and then judged at the beginning of 2023 that Depin would be one of the most noteworthy tracks in the crypto space in the next decade. The entry of capital has led to the rapid development of DEPIN, and there are currently more than 600 DEPIN projects. As the market warms, venture capitalists have begun to be active again, and there are countless new investments and financing in the field of DEPIN.
Not to mention blockchain, even the Internet of Things platform, big data, cloud computing, AI, VR, AR and other technologies that have been used on a large scale have actually experienced repeated cycles of hype and bubble bursting. Therefore, we ordinary investors should not be too biased about one thing because of the past.
How do I choose and participate in the DEPIN program?
Even if there is a large increase in the entire sector now, the whole track of DEPIN is still in the early stage, and the development of DEPIN is top-down, which requires the project party to continue to cultivate, and it will hardly dare to get on the car at every turn like meme, let alone inexplicably emerge a myth of "10,000 times increase".
There are two ways to implement investment. One is speculation, taking advantage of the current hot mood and trending escort to buy some DEPIN project tokens. For example, FIL, HNT, RNDR, AR, AKT, etc. are listed on the big exchanges, and the leading sectors with good liquidity. In this way, it is not necessary to buy equipment, there is no need to consider the payback cycle, and the take-profit and stop-loss are more flexible, and the disadvantage is that it is easy to go short.
On the other hand, if you are optimistic about the potential of the DEPIN track and think that this track may be a big narrative like DeFi and public chains, then deeply participate in some potential new projects with good fundamentals, and continue to invest in construction, ignore short-term fluctuations, and gain a growth income.
The disadvantage of this is that it takes a long time and energy, and if you don't choose it properly, the project will die and end up with no results. Therefore, the ability to choose between hundreds of projects is very important.
We can practice the take-it-or-leave-it doctrine and let the agency help us screen it first. Many institutions and ratings** publish lists for investors' convenience. These lists will screen and summarize some of the best or well-known projects in the same track. We only need to analyze a few projects in the list, and finally select the best 1-2 projects for each section to participate in, so as to avoid looking for a needle in a haystack.
Taking wireless as an example, there are a total of 5 projects listed in the WiFi sector, namely Metablox, WiFiMap, Wayru, Wicrypt, and WiFi Dabba. (Data based on 2023 12).
Wayru, Wicrypt, and WiFi Dabba are mainly used for wireless networks in developing regions (such as Latin America and India), with small communities and slow infrastructure construction.
WiFi Map has the largest number of users, but the function is similar to the overseas version of 360***, no hardware device support, the main profit method is subscription and advertising, and the team has weak experience in Web3 operation.
The most promising of these is Metablox, which aims to build a global WiFi open roaming network that provides enterprise-grade WiFi roaming to the public by giving users the ability to seamlessly switch between public WiFi networks with Decentralized Identifiers (DIDs) and corresponding Verifiable Credentials (VCS).
The main members of the team are located in Canada, and the seed round was led by Synergis, a well-known institution in North America, with participation from Depinlabs, Collab and other institutions.
Metablox is one of 11 Identity Providers (IDPs) of the Wireless Broadband Alliance (WBA) OpenRoaming and the only Web3 company among them.
Information ** on the official website of WBA OpenRoaming.
Thanks to the innovative model of Web3, Metablox has deployed 70,000+ self-built WiFi network nodes in 100+ countries around the world in just two years, ranking second in the world in terms of the number of nodes in the Depin track, according to the data of DepinScan's official website.
Users can also share and use more than 3 million WiFi nodes deployed by Boingo, Cisco, Global Reach and other enterprises in the OpenRoaming Alliance on land, ships and aircraft, and can make convenient and secure WiFi connections around the world to achieve free network roaming.
** as of Metablox, data as of 20242
In the entire wireless track, other competitors are either in a corner and only developing part of the area, or they are "halfway home" hoping to rub off on the popularity of Depin, Metablox is a pure Web3 project. And through its own excellent strength and strong partners, it has rapidly expanded to complete the deployment of infrastructure, so that the product can be truly used.
Metablox tokenomics
The toughest challenge in the DEPIN space, and in the crypto market as a whole, is the impact of token volatility. Unlike traditional companies, which are mostly allowed to go public only after they have developed to a certain scale and have good profit prospects, DEPIN projects often use the issuance of tokens as an incentive at the initial stage to encourage participating users and operators to invest in the deployment of relevant hardware.
This approach provides participants with initial financial compensation and a small return on investment, incentivizing them to continue running until the network is not yet self-sustaining through user fees. With the development of the network and the expansion of scale, the project is expected to achieve economies of scale.
However, the volatility of the token itself can be a factor hindering users' participation in the DEPIN project. The main driver of user engagement is profitability: despite the Depin project's clear value proposition, the market performance of its native token remains a key factor in attracting and retaining users.
As participants are rewarded with the project's native token, the instability of ** can directly affect their earnings. The rise of the token tends to make it easier to attract users who are interested in the trend of the market. Conversely, during a market downturn, a decline in token value and profitability may prompt some participants to leave. This is especially true for tokens with low market caps and less liquidity, which can trigger a series of death spirals, which have been seen in many previous DeFi (but also GameFi, Depin) projects.
As a medium to pay for network service fees, the fluctuation of the token will also have an impact on the user. If the token** rises sharply and the service fee is not adjusted accordingly, that is, the threshold is too high, it may cause potential users to be afraid to participate. Therefore, having a robust tokenomics and operating model is essential to mitigate the impact of volatility.
Metablox's tokenomics model consists of the following three elements:
Mpoints: Mpoints play a central role in Metablox's token system, which can be earned by participating in the network, check-in-to-earn, or by purchasing directly and redeeming them from Metablox partners. In the future, mpoints can also be exchanged for governance tokens through staking, burning, etc.
Governance tokens: Users can obtain governance tokens in a variety of ways, such as through staking, participating in events, or receiving airdrops. These tokens are mainly used to verify network services, participate in community governance, and obtain operational permissions.
Metablox NFTs: NFTs issued by Metablox** that can be tied to specific mining devices. NFT holders can earn mPoints by staking NFTs, while NFTs also provide their holders with a special identity within the community.
There is a complex and multi-layered swap mechanism between these tokens: Mpoints can be exchanged for governance tokens through staking burn, while Metablox NFTs can be staked to earn mPoints rewards. This design constitutes a token ecosystem that is both complex and closely connected.
Open card airdrop & participation method
At present, Metablox has not yet issued coins, which is in the early days. And the official card announced the airdrop, which can be participated in for free.
Go to the App Market to get Metablox. Apple needs an overseas ID, and Android needs a Google store.
Follow the process to add wifi to get Mpoints rewards, and you can get Mpoints every day when you check in.
Depin's use of a distributed transparent system to improve the scalability and operational efficiency of the infrastructure is in line with the principles of the cryptocurrency industry. Such projects apply tokenomics and pool crowdsourced resources such as storage capacity and computing power without investing a large amount of initial capital. It has potential application scenarios in various industries, indicating a huge potential market.
There are still many challenges in the process of adoption, such as product experience, moat building, regulatory compliance, and talent shortages. DEPIN will not be able to completely replace centralized networks in the short term, so it is likely to coexist with traditional infrastructure providers. In the long run, the emergence of DEPIN will have a profound impact on the market, whether it is from the perspective of lowering the barrier to entry, innovation, or leveraging idle resources and money flows.
For us ordinary investors, the best choice is to follow the trend when the wind comes, put aside prejudices and participate boldly. When the market is overheated, keep a sense of sanity and withdraw in time.
This article does not constitute investment advice or recommendation