{"id":149455,"date":"2024-01-11T04:33:23","date_gmt":"2024-01-11T04:33:23","guid":{"rendered":"https:\/\/www.techopedia.com\/?post_type=definition&p=149455"},"modified":"2024-02-23T20:42:18","modified_gmt":"2024-02-23T20:42:18","slug":"decentralized-physical-infrastructure-networks-depin","status":"publish","type":"definition","link":"https:\/\/www.techopedia.com\/definition\/decentralized-physical-infrastructure-networks-depin","title":{"rendered":"Decentralized Physical Infrastructure Network (DePIN)"},"content":{"rendered":"

What are Decentralized Physical Infrastructure Networks (DePINs)?<\/span><\/h2>\n

Decentralized physical infrastructure networks (DePINs) are<\/span> blockchain<\/span><\/a> protocols<\/span><\/a> that build, maintain, and operate physical hardware infrastructure in an open and <\/span>decentralized<\/span><\/a> manner.<\/span><\/p>\n

The DePIN industry covers infrastructure for <\/span>data storage<\/span><\/a>,<\/span> wireless connectivity<\/span><\/a>,\u00a0<\/span>computing<\/span><\/a>, energy, data collection, and more.<\/span><\/p>\n

DePIN protocols have garnered crypto investor interest lately due to their potential to impact a wide range of industries, including<\/span> the Internet, <\/span>artificial intelligence<\/span><\/a> (AI), energy, wireless communications, and more.<\/span><\/p>\n

Techopedia Explains the DePIN Meaning<\/h3>\n

\"DePINs<\/p>\n

A DePIN is a <\/span>peer-to-peer<\/span><\/a> (P2P) network that meets <\/span>hardware<\/span><\/a> demand through an open and decentralized marketplace.\u00a0<\/span><\/p>\n

Cryptocurrencies<\/span><\/a> are at the center of DePIN community building. DePINs use crypto token rewards to attract and incentivize real-world physical infrastructure operators to join their networks.<\/span><\/p>\n

When the value of a DePIN\u2019s token rises (as investor capital enters the network), it enables service providers to offer competitive pricing.\u00a0<\/span>It leads to growth in adoption and demand for DePIN\u2019s services, which ultimately leads to a further rise in <\/span>token<\/span><\/a> price, attracting more investors, service providers, and users.<\/span><\/p>\n

According to a<\/span> report<\/span><\/a> by crypto research firm Messari, DePINs can be classified into two groups:<\/span><\/p>\n

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  1. Physical Resource Networks <\/strong>(PRNs)<\/strong>: <\/span><\/strong>DePIN protocols that incentivize service providers to deploy location-dependent hardware that supplies certain physical locations with energy, connectivity, and <\/span>geospatial data<\/span><\/a> use cases.<\/span><\/li>\n
  2. Digital Resource Networks<\/strong> (DRNs)<\/strong>: DePIN protocols that create location-independent back-end for the cloud and incentivize service providers to supply digital resources like <\/span>computing, storage, and <\/span>bandwidth<\/span><\/a>.<\/span><\/li>\n<\/ol>\n

    How Do DePINs Work?<\/span><\/h2>\n

    DePINs function through three key elements<\/strong>: off-chain network, blockchain, and protocols.<\/span><\/p>\n