Decentralized physical infrastructure networks (DePINs) are reshaping traditional infrastructure models and offering opportunities analogous to today’s gig economy, said Kuleen Nimkar, head of Solana Foundation DePIN.
While many people today earn supplemental income by driving for Uber or delivering for DoorDash, over time people can also generate additional income by contributing hardware to DePIN protocols, Nimkar told The Block in a recent interview.
What’s more, Nimkar argues, is that contributors to DePIN networks can generate significant revenue by supporting a network in its early stages, and earn tokens that later appreciate as the network grows. “That’s something that never happened with the web2 gig economy. Early Uber drivers didn’t see an outsized benefit in supporting Uber before it became a behemoth,” he added.
DePIN protocols use token incentives, co-constructed with the broader DeFi ecosystem, to help spin up hardware networks and provide services such as computing power and storage.
Hivemapper, Render and Helium
Nimkar cited Solana DePIN projects such as Hivemapper, Render and Helium as examples – incentivizing contributors to build network growth and reducing initial investment costs compared to traditional infrastructure models.
Hivemapper offers tokens to drivers who install a dashcam and collect map data while driving around. With Render, anyone with excess GPU power can connect their hardware to the protocol and make money by providing computing power for customer use cases such as machine learning training. Decentralized wireless network Helium, which recently debuted a 5G mobile service in Miami for $5 per month, allows distributed node runners to generate revenue by hosting dedicated hotspots from their home or business to provide mobile connectivity to nearby users.
Organizations can pay for DePIN project services with their respective tokens. However, Nimkar suggested this could transition to stablecoins as these new platforms mature, with the protocol token utility focusing on governance instead.
While the Solana Foundation occasionally subsidizes or invests in such projects, the focus is on accelerating the ecosystem and giving influence to the best builders, Nimkar said. “Whether or not a team receives a grant or investment has no bearing on that focus.”
Why Solana is the ‘standard’ DePIN network par excellence
Nimkar believes Solana is now the “default choice” for decentralized physical infrastructure projects due to its low transaction costs, high throughput, scalability and existing DePIN ecosystem.
Helium is an example of this, migrating from its own blockchain to Solana, which, along with existing DePIN projects, has “catalyzed a lot of tooling and infrastructure development for DePIN on Solana, making it even easier for new DePIN projects to use Solana utilize.’ said Nimkar.
Solana’s decentralization journey
Often criticized for perceived centralization and occasional downtime, Nimkar states that by most measures Solana has become one of the most decentralized blockchains today. Nimkar pointed to the network’s approximately 2,000 globally distributed validator nodes and its Nakamoto coefficient, a measure of network security, which surpasses many of its peers.
As an example of Solana’s distribution, Nimkar highlighted that German data center operator Hetzner blocked Solana’s activity last year, which led to 1,000 validators temporarily going offline, preventing them and their delegators from earning stalking rewards. Because the remaining validators were decentralized across other infrastructure providers, the network functioned “without any issues,” Nimkar said, with almost all validators involved back online at various data centers within a few days.
Nimkar added that the Solana Foundation was particularly excited about the launch of Firedancer, Jump Crypto’s validator client. Firedancer is an open-source, independent Solana validator client, which can help identify bugs, vulnerabilities or inefficiencies in the original client and provide network redundancy if issues arise with one client, Nimkar said.
“Once Firedancer is live, Solana will be the only major Layer 1, aside from Bitcoin and Ethereum, to have multiple independently managed validator clients,” Nimkar added.