Solana and Base Lead the DePIN Chain Wars Amid Interoperability Push

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There’s been a significant surge of interest in Decentralized Physical Infrastructure Networks (DePIN) projects over the past year. Interestingly, even as cryptocurrency markets doubled in 2024, DePIN managed to surpass this growth rate. This impressive performance can be linked to the growing global recognition of Artificial Intelligence (AI).

Fresh findings show that the fledgling industry only controls a small fraction, under 0.1%, of its over $1 trillion potential market.

DePIN Is The “Frontier”

In my analysis, I foresee a significant expansion for DePIN as it surpasses traditional centralized corporations due to its swift and dependable services. Based on Messari’s most recent findings, I predict that DePIN could potentially increase 100 to 1000 times over the next ten years.

It’s intriguing to note that the competition among blockchains, often referred to as “chain wars,” has become more fierce recently, with Solana and Basis (Base) gaining significant market traction. Interoperability platforms such as Wormhole and LayerZero are prompting projects to employ multi-chain strategies, which expands their user base but disperses liquidity in the process. Messari suggests that Solana’s focus on reducing latency has attracted innovators at the infrastructure level, while Coinbase’s well-known brand and retail distribution have drawn founders with a consumer focus to Base.

At the initial stages of venture capital, it was noticed that VCs were actively pouring funds into DePIN, driven by favorable IPO conditions. In the realm of private investments, financing during pre-seed and seed phases surpassed Series A funding rounds. On the other hand, in open markets, projects with lower Float-Adjusted Market Values (FDMV) at listing time showed the greatest returns.

Among the top 22 DePIN tokens, just four experienced a decrease in value following their Token Generation Event (TGE). Notably, Virtuals Protocol stood out with an impressive over 30,000% increase. Additionally, NEURAL and NodeAI displayed strong performance, each experiencing growth exceeding 2,000%.

Investments in mature stages primarily focused on exceptional projects, backed by prominent venture capitalists. These projects introduced tokens that were initially worth 50 to 100 times their estimated value, often reaching valuations of several billion dollars. Additionally, community involvement played a significant role in fundraising; in the year 2024, a total of $230 million was successfully raised through node sales, crowdfunding campaigns, and liquidity pools managed by the protocol itself.

Moreover, DePIN is increasingly being utilized by local administrations to tackle infrastructure issues. Intriguingly, according to the report, leaders are employing it to address significant matters like fostering AI autonomy in Tanzania and narrowing the digital gap in Mexico. This strategy seems aimed at appealing to voters and ensuring electoral success.

DePIN Poised for Growth in 2025?

According to the investment firm Pantera Capital, the upcoming year 2025 might be pivotal for DeFi (Decentralized Finance), as it could witness the emergence of regulatory clarity that may remove significant obstacles for both investors and pioneers in this field.

Grayscale Research, too, shares this perspective and highlights DePIN as a significant area of concentration on their Top 20 list of cryptocurrency investments.

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2025-01-12 20:26