Analysis of the DePIN competitive landscape: Top projects occupy 80% of the market share but generate minimal revenue, as the influx of capital enters the scene.

As one of the important drivers pushing cryptocurrency into the mainstream, the DePIN ecosystem has shown strong development momentum and has become one of the main investment themes attracting a swarm of capital so far. However, the current expansion of the DePIN market is mainly led by top projects moving forward, with overall profit capabilities limited, and facing risks such as regulation and network security. DePINscan data shows that as of September 19th, there are approximately 276 projects in the DePIN category, mainly divided into categories such as AI, wireless, energy, services, sensors, data, and computing. Currently, the overall market capitalization of DePIN has reached close to $21.23 billion, a growth of 17.1% since the beginning of the year, with the top ten projects accounting for about 80.5% of the market value, reaching $17.08 billion. In terms of the distribution of DePIN projects on various chains, they mainly come from Ethereum, Solana, IoTeX, and Polygon. Among them, there are 54 DePIN projects on Ethereum and 36 on Solana. Meanwhile, DePINscan data shows that the current total number of DePIN devices has exceeded 18 million, with nodes spread across 195 countries and regions globally, mainly concentrated in Asia, the United States, North America, India, Southeast Asia, Africa, and Europe. Additionally, the funding scale of DePIN is also growing significantly. According to the August DePIN industry report released by Messari, the funding scale in the DePIN sector has increased by 296% year-on-year, with the largest single funding being $50 million raised by IoTeX in April, and the other top five projects including io.net, DIMO, and Daylight have deep cooperation with IoTeX in data verification, off-chain computing, or capital layers. However, the overall revenue situation in the DeFi sector is not optimistic. According to Depin.Ninjia data, as of September 19th, the cumulative revenue of the Top 10 DePIN projects is only $1.02 million. Currently, the DePIN market is facing more competitive variables and growth space. On the one hand, some institutions have launched large-scale DePIN investment funds, such as Borderless Capital recently launching a $100 million DePIN fund, with LPs including blockchain Peaq focused on DePIN, Solana Foundation, and Jump Crypto, etc.; UAE-based investment companies Hodler Investments and Gewan Holding plan to launch a $500 million fund to invest in DePIN and other areas; Bitrue Ventures has launched a $40 million investment fund focusing on DePIN, RWA, and other areas; SOLLONG Foundation announced a $30 million new funding plan to promote the development of DePIN and AI; investment company Lemniscap announced that it has raised a $70 million fund, focusing on early-stage Web3 projects such as DePIN, etc. On the other hand, recently, a large number of capital-backed DePIN new projects have also entered the market. For example, the renewable energy DePIN project Project Zero's parent company Fuse recently announced the completion of a $12 million strategic financing led by Multicoin Capital; DePIN flight tracking network Wingbits protocol completed a $3.5 million seed round financing led by Borderless Capital and Tribe Capital; Solana-based DePIN project Andrena completed an $18 million financing led by Dragonfly; Base-based DePIN project Daylight received a $9 million Series A financing led by A16z Crypto; DePIN network developer Verida completed a $5 million seed round financing with participation from Simurg Labs, O-DE Capital Partners, ChaiTech Ventures, etc.; DePIN Layer1 protocol Peaq raised $20 million through CoinList; DePIN project Blockless completed a total of $8 million in seed and seed rounds, including NGC Ventures leading the seed round financing, M31 Capital and Frachtis jointly leading the seed round financing, etc. The capital market's enthusiasm also confirms the strong development potential and attractiveness of DePIN. Regarding the rapid development of DePIN, Helium CEO Abhay Kumar pointed out with his own case during the Token2049 roundtable discussion that traditional markets using advanced geolocation services have to some extent driven the development of DePIN, providing customers with more competitive value propositions, including lower costs, better coverage, and ease of integration, with application scenarios including civil measurement, high-definition map drawing, construction, agriculture, etc. Nowadays, the attention of the cryptocurrency market has expanded from trading or storing value for entertainment purposes to real-world applications, with tens of billions of consumers and millions of companies relying on map services just in Helium's case. In order for the cryptocurrency field to become more important and popular in the next 5 or 10 years, cryptocurrency products and services need to be successful.GEODNET CEO Mike Horton added in the roundtable discussion that a healthy balanced token economy is a powerful tool for DePIN, enabling the actual usage and value of the network to be returned to users. As the network utility grows, the value of the tokens will also increase. Rating agency Moody's recently released its first report on the DePIN field, pointing out that DePIN can help existing networks expand and innovate. Specifically, existing network operators such as telecommunications companies, utility companies, etc., are facing increasing user demands, requiring capital-intensive infrastructure development. Utilizing a decentralized model can help them alleviate some pressure and remain competitive while disrupting old business models with artificial intelligence and the Internet of Things (IoT). By integrating established parts of the system backbone with the building blocks of Distributed Ledger Technology (DLT), DePIN has the potential to enhance network reliability and efficiency, reduce operating costs, optimize resources, and industry collaboration. However, Moody's also notes that widespread adoption of DePIN faces significant obstacles, including regulatory and interoperability issues, network security risks, substantial investments in infrastructure and skills, unclear regulations, and various risks that may inhibit its growth.