Consumer DePIN Unlocks Web3 Mass Adoption

Decentralised physical infrastructure (DePIN) is positioned to onboard the next generation of blockchain users by integrating with everyday systems like car software and WiFi networks. 

By incentivising consumer participation, DePIN promises to add efficiency and value to the infrastructure powering our daily lives.

To highlight this - when I told my mum she could earn while driving, her response was: “how do I sign up?”

If my mum gets it, anyone can.

Consumer-facing DePIN applications present blockchain technology through simple, understandable interfaces tied to habits and services people already use.

To better understand the DePIN landscape, I interviewed Alex Rawitz, co-founder of DIMO - a decentralised, open protocol allowing drivers to securely share data and earn rewards - and COO of Digital Infrastructure Inc, the company tasked with growing the DIMO ecosystem. With over 44,000 drivers onboarded, a $2M DIMO Ignite grant programme, and $20.5M raised by Digital Infrastructure Inc, DIMO demonstrates the massive promise of consumer DePIN.

In this article we’ll cover the importance of DePIN applications, how DIMO has scaled to success, and why consumer DePIN applications will bring in a new wave of blockchain users.

The DePIN movement

We’ve probably all used hotspots from WiFi networks, solar panels for energy, or cloud servers. These are examples of the physical infrastructure networks that DePIN aims to transform.

Currently, these industries are dominated by a few powerful monopolies who control pricing and services for everyday users. This centralised approach has led to dissatisfied customers, rising bills, and high barriers to entry for startups, as evidenced by the extremely low net promoter scores (NPS) for the U.S. telecommunications industry.

DePIN decentralises these networks, putting more power back into the hands of users - similar to how Uber disrupted the taxi industry by removing middlemen. Instead of allowing big corporations to continue their monopolies, DePIN gives users the opportunity to deploy and manage their own infrastructure, while also incentivising participation.

This switches the gears from reliance to ownership. 

As a user you could set up your own hotspot to contribute to the Helium network and earn rewards. Or you operate a node to contribute to the FIlecoin ecosystem to earn rewards by reserving disc space on your computer. The opportunities are ever growing, which is why this is so exciting from a consumer perspective.

These applications are also simpler to understand. Simplicity has been the missing link for mass crypto adoption. I mean, have you ever tried to onboard your mum onto a DeFi platform? I did, and it resulted in a 20+ step onboarding document she still doesn't fully grasp. But when I introduced her to DIMO, it clicked right away.

As the crypto space matures, so too are the business models. The 2021 bull run sparked hype around "X to earn" apps, but many relied on unsustainable token incentives without thoughtful revenue generation. Think of "X to earn" as a marketplace - you need both supply (incentives attracting users) and demand (revenue from services) to build a sustainable model. Most apps to date have only focused on supply.

DePIN projects build more sustainable models by creating demand for the physical infrastructure users provide, such as WiFi bandwidth or cloud computing power. There is inherent value in these services beyond speculative crypto incentives. While success is not guaranteed for every project, tying token rewards to real-world utility represents an evolution for Web3.

Introducing DIMO

DIMO was established in 2021 to disrupt existing physical networks in mobility, beginning with the auto industry. The auto industry is at a critical point, with innovations like self-driving cars, electric vehicles, and evolving safety regulations. However, central to all these innovations, auto manufacturers rely on one key commodity: data.

Manufacturers such as Tesla have done an incredible job of building deep data sets from their vehicles, allowing them to deliver high quality products faster than the rest of the market. The rest of the auto market hasn’t always been as forward-thinking, so they’re now in a race to catch up. DIMO helps them close this gap.

DIMO empowers users to share their driving data, which is then licensed to buyers like auto manufacturers, insurance providers, maintenance services, and more. Users earn rewards for their data contributions. With the increased technological integration in vehicles, DIMO users can simply download an app, contribute data, and start earning. Alternatively, they have the option to connect one of two physical devices to their car for collecting more detailed data.

The DIMO Ecosystem already has dozens of companies working within it, but the core entity is the DIMO Foundation, which supports the development of the DIMO Protocol.  The protocol is open source and on a path to progressive decentralisation. It provides the technological infrastructure for applications and generates revenue by enabling core functions like vehicle/device registration and permissioned data sharing.

The DIMO Foundation is tasked with navigating business compliance and regulations for DIMO. The Foundation supports ecosystem growth by licensing and approving authorised hardware and software partners building on the network. These partners, such as Digital Infrastructure Inc., AutoPi ApS, and Hashdog, build and promote the consumer-facing applications and products that connect new users to DIMO. For example, Digital Infrastructure Inc. developed DIMO Mobile and developer APIs allowing easy access to the protocol. The app brings in revenue through an auto services marketplace.

This division of protocol and application development allows each to focus on sustainability through different monetization models. Together they encourage participation on both sides of the marketplace.

The $DIMO token allows this ecosystem to scale efficiently. Drivers earn $DIMO when they contribute data. Data buyers then purchase this data using $DIMO. As a contributor, you always earn a portion of the weekly token drop (baseline issuance) and additional $DIMO when developers or buyers acquire your data. This issuance-and-burn system, alongside governance rights, comprises a sustainable tokenomics model rooted in utility.

Through this model DIMO has scaled to 17,000 registered drivers, 44,000 registered vehicles, and 8,825 marketplace transactions. They attribute most of this growth to organic word of mouth among drivers and establishing industry partnerships, both with other DePIN projects and more traditional Web2 players.

Visit DIMO’s dune dashboard for a detailed breakdown here.

The Consumer DePIN Catalyst

As DIMO demonstrates, technological advances from both the physical and digital world are aligning to build the next generation of infrastructure networks.

Digital maturity is particularly evident within the blockchain space.

Applications that facilitate safe blockchain interactions for mainstream users are maturing. Wallet solutions like Privy now allow sign-ups via email, social profiles, or phone numbers - no crypto expertise required. View their demo app here.

Additionally, consumer applications like DIMO are focusing on sustainability, building clear revenue models beyond speculation. This trend can also be seen in the rising earnings of blockchain infrastructure and DeFi projects. For example, over the past year MakerDAO increased revenue ~74% by diversifying their treasury into yield-generating products.

On the other side, physical infrastructure advancements have led to a rise in digitally-native products.

Innovations like IoT (Internet of Things) allow us to embed physical products with software, sensors, and other connected technologies, making them smarter. A prime example is Amazon’s Alexa product line - devices that integrate software and internet connectivity to interact with us via voice. Alexa has clearly become a household staple, with sales growing steadily year-over-year as adoption continues increasing.

Technological advancements in areas like AI and machine learning have enabled major IoT advancements over the past few years. As the market continues growing, we will see rising demand for IoT products, which inspires further innovation.

Market maturity from IoT and blockchain products signals a green light for the DePIN sector. Through building decentralised models that incentivise user participation, we could be at the forefront of some massive consumer network effects.

Conclusion

The emerging DePIN sector looks set to deliver the next wave of digital services. It does this by making real-world infrastructure like wifi networks or charging stations decentralised.

There are 3 big reasons driving this change:

1. New technologies like blockchain and AI now allow decentralised management of physical infrastructure on a large scale. The tech abilities are maturing.

2. Projects like DIMO make it easier for regular people to participate. They use familiar interfaces and reward behaviours people already do, like driving or charging an EV. This can drive mass adoption.

3. Innovative models align network growth with real utility. Token earnings link to providing bandwidth, data, computing power, etc. This roots projects in concrete value, not just hype.

As these factors combine, DePIN promises to shift control of infrastructure from big companies to open, user-run networks. Much like Airbnb for hotels or Uber for taxis. The outcome - improved affordability, satisfaction, and competition to drive the next phase of digital innovation.

To learn more about DIMO visit their website here, follow them on twitter (X) here, or join their community discord here.

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