No one wants to pay high monthly fees for slow internet, but that’s the reality for millions of Americans. The US ranks outside the top 10 countries in global internet speeds and yet has one of the highest subscription fees in the world.
A key factor driving these costs is the lack of competition among Internet Service Providers (ISPs) due to the high expense of infrastructure. In this type of market, ISPs have little incentive to upgrade their infrastructure or offer competitive rates.
Today, 52% of Americans only have one home internet provider, leading to expensive plans and unsatisfactory service. ISPs consistently have the lowest customer satisfaction scores, with users citing rising costs, poor support, and a lack of meaningful improvements as their main grievances.
Unfortunately, the same is true for the US cellular market, where a handful of carriers dominate the landscape and hold the majority of market share. The concentration of power among centralized providers creates an environment that’s ripe for disruption.
Innovative projects that seek to create new solutions can provide better connectivity and prices for users. Internet service, cellular networks, and other areas are all examples of where centralized products fall short and decentralized solutions can provide more value to users.
Decentralized Physical Infrastructure Networks (DePIN) are distributed networks of nodes that provide services and information to users. They incentivize participants to operate the network, use its services, and benefit from the data that’s collectively generated. These networks represent a novel type of use case made possible by blockchain technology.
DePIN networks not only foster collaboration but also enhance efficiency and transparency in how physical and digital infrastructure is managed. They can be classified into two main types:
Currently, large-scale DePIN projects have emerged in telecommunications, data storage, and computing. The sector has exploded with 400% year-over-year growth, surpassing a $20 billion market cap. Builders have secured $246 million in venture funding across 70 projects, with deal flow increasing nearly 300% since 2023. High-demand services like cellular and decentralized data are leading the market. At the same time, several novel sub-sectors are also emerging as key players.
There are many real-world problems that builders are looking to solve through DePIN. Trending sectors include energy, wireless, and AI infrastructure. Not only do DePIN networks provide better services for users, but they also enable these communities to monetize excess compute, broadband, and more broadly energy on-demand. This model is analogous to how households with solar panels can sell excess energy back to the grid. In the not-so-distant future, users will be able to do the same for unused broadband capacity, GPU compute, and carbon offsets as well.
New DePIN projects leverage the benefits of decentralization, tokenization, and distributed systems to scale rapidly. Early operators establish nodes enable the network’s services in return for token rewards. These operators help solve the initial cold start problem and secure early customers by addressing coverage gaps they have previously encountered with the new network’s services. Token incentives help support the expansion of network coverage in hotspots where there is growing product demand.
DePIN projects leverage early network effects by rewarding contributors with ownership. Early contributors benefit from enhanced DePIN services, and over time this creates a self-sustaining distributed network. Better services attract more users, which incentivizes network operators to expand coverage. Well-designed DePIN networks benefit from flywheel economics with positive supply-side and demand-side incentives for customers, token holders, and node operators.
Novel DePIN solutions like Geodnet, Hivemapper, and Helium provide precision data for mapping, GPS, and cellular data consumers. Google Maps alone is estimated to be worth $62B. This underscores the massive potential for large-scale DePIN networks to offer superior utility services, real time data for omni-channel consumption, and unique rewards not possible with CePIN.
The decentralized nature of DePIN unlocks open-source data to a large pool of smaller stakeholders. New DePIN networks will provide new economic value for the global digital economy, compounding the growth of the network, use of verifiable information, and optimized solutions for real-world use-cases.
Solana has emerged as the top choice for DePIN builders and hosts global networks like Helium, Render, and Hivemapper. According to Messari's 2024 DePIN report, Solana takes the lead as the home of almost 80 DePIN projects, followed by Ethereum and IoTeX. The benefits of building on Solana are clear, from its strong community to its high performance. However, certain limitations remain to be addressed.
For example, Grass Network, an AI data layer with 2M+ connected devices, has to support millions of data validation requests per minute. Unfortunately, such high volumes will not scale on any existing L1, motivating the network’s design as a Solana rollup with dedicated blockspace. This challenge isn’t unique to Grass, and new builders can utilize Termina’s deployment platform for effective solutions.
As demand for Solana technology increases, Termina supports builders by enabling easy deployment of custom SVM solutions that are tailored to individual needs. DePIN projects with requirements that surpass Solana’s average real TPS of 3K can benefit from custom SVM instances. These instances ensure service uptime and performance guarantees for customers who depend on the network for daily use.
Termina is building the first SVM-as-a-Service platform that enables developers to deploy custom rollups, batchers, and permissioned blockspace for new DePIN networks. This approach ensures the creation of use-case optimized, controlled, and cost-effective SVM infrastructure that is difficult to replicate by other blockchains. It allows builders to focus on user acquisition, network growth, and innovations at the application layer.
Are you interested in building the future of DePIN networks on the SVM? Explore our docs, join the Termina devnet waitlist, and follow us on Twitter for real-time updates on our progress, new initiatives, and rapidly growing ecosystem.
