introduction
Since the beginning of this year, in the context of the strengthening of the US dollar, RWA has opened up the channel between traditional finance and crypto finance, and has become one of the few excellent sectors in the bear market. DePIN, as a subset of RWA, has been gaining traction recently. DePIN stands for Decentrailized Physical Infrastructure Networks, a new concept defined by Messari in a 2022 DePIN research report, which Messari believes is "one of the most important areas for crypto investment in the next decade."
Just as RWA is not new, it is a product of DeFi development and the external environment, so DePIN is not new. As early as the birth of Ethereum, there have been many projects that have tried to decentralize infrastructure such as energy, storage, and computing. Projects such as Filecoin and Helium have already made some progress.
At the recent Hong Kong Fintech Week, DePIN became the focus of attention for the Web3 industry, and the combination of Web3 and physical facilities is considered the next outlet. Techub News published an article saying that "DePIN is the biggest narrative of Web3 in Hong Kong".
Future Money has always attached great importance to the research of the DePIN track, and this article will mainly introduce the representative project of DePIN, IoTeX. IoTeX is an IoT (Internet of Things)-oriented next-generation blockchain platform with its own characteristics in terms of scalability, deep privacy protection, independence, etc., and is committed to providing comprehensive support for IoT applications and building a blockchain ecosystem.
The market space for DePIN
The well-known DePIN projects are mainly focused on storage and communications, and in fact DePIN has the potential to be used in industries such as energy, computing, IoT, and supply chain. For example, React, a decentralized energy storage asset network, uses decentralized Web3 technology to save energy and improve grid efficiency, allowing participants to connect their home batteries to the Web3 energy storage network, and businesses and individuals who access it can receive cash and token incentives. Render Network, a decentralized GPU platform, can provide rendering capabilities for large-scale video production, 3D modeling, and film special effects projects.
Traditional physical infrastructure construction is capital-intensive, long investment cycle, and low returns, and the use of blockchain's token incentive mechanism to unleash the potential of decentralized hardware can effectively solve this pain point. At the heart of the DePIN model is the use of token incentives and flywheel effects to connect distributed demand with idle physical resources to meet demand at a lower cost and with greater efficiency.
According to DePINscan, a public data platform for DePIN created by IoTeX, 370,000 devices are already connected to Web3, albeit a very small fraction of the physical world, despite rapid growth.
IoTeX: A full-stack solution for DePIN applications
Founded in 2017, IoTeX has been working on the combination of physical devices (and their data) and blockchain technology since its inception. IoTeX ensures that people can own and control their devices, data, and the value they generate, making builders and users the owners and beneficiaries of a trillion-dollar IoT economy. Based on its contributions to the Internet of Things, IoTeX was selected as the co-chair of the Industrial Internet Consortium (IIC) Blockchain Group, along with Amazon and Huawei.
IoTeX has built an EVM-compatible Layer1 blockchain designed for IoT data and DePIN applications. By providing the DePIN middleware W3bstream, the DePIN physical device and data are connected to Layer 1. Any DePIN application can create its own dAPP with one click on W3bstream, including hardware components, off-chain logic programs, on-chain logic/token economy, based on the application logic, incentivize the flow of real-world data, and generate token rewards for users.
IoTeX's full-stack DePIN solution provides a full suite of "plug-and-play" products and tools for blockchain-powered IoT applications, allowing you to focus on business logic when building DePIN applications on the IoTeX platform. Its full-stack DePIN infrastructure is divided into four tiers from top to bottom:
- Hardware layer: MachineFi is a hardware portal platform where developers and users can register devices, get visual data, and interact with MachineFi dApps.
- Middleware: W3bstream It is a middleware between a smart device and a blockchain that connects smart devices to smart contracts to generate proofs of on-chain dApps.
- Tooling layer: IoTeX provides a series of tools to help applications interact with data and flow value, such as ioScan, a blockchain explorer for querying blockchain data, and ioTube is a cross-chain bridge to facilitate two-way token swaps between IoTeX, Ethereum, BNB Chain, and other top L1s.
- Blockchain: IoTeX Blockchain is an EVM-compatible L1 designed for IoT data.
The history of IoTeX and its real-world applications
History of IoTex
IoTeX was founded in 2017 and began building a Layer1 blockchain in early 2018 after raising approximately $30 million in funding from the then-top venture capital firms. In that year, the L1 testnet was launched, followed by tokens on Binance, Kucoin, and Gate.
In 2019, IoTex developed a PoS-based EVM public chain and incubated many DeFi and NFT projects, with more than 100 ecological application data, including ioPay, staking portal, IoTeXScan, and more.
In 2020, the first Iot + blockchain vertical experiment began: Ucam, which won the CES award and garnered more than 20,000 sales on Amazon. In 2021, the second IoT + blockchain vertical experiment: Pebble was launched, and within two weeks, 1000+ sales were achieved. At the same time, through two social experiments, the concept of "MachineFi" was introduced, and it was used as a direction. "MachineFi" is the DEPIN that is now defined in the industry.
In 2022, we started working on the W3bStream project and partnered with the DePIN project team to provide infrastructure support. The team hopes that in the future, W3bStream will become the standard for the entire industry. In May and June of that year, MachineFi Lab closed two funding rounds totaling $60 million. In 2023, IoTeX clearly put forward the strategic development plan of "DePIN First", focusing on improving the imperfect infrastructure in the DePIN ecosystem, and launched the W3bStream project, actively participating in DePIN and cooperating with various projects in the ecosystem to promote the development of the entire ecosystem.
IoTeX use cases
With the rapid development of the Internet of Things, the number of connected devices and the data generated is growing exponentially. However, the IoT industry also faces some challenges: various sensing devices and execution devices often come from different enterprises, and there is a lack of effective coordination, resulting in low equipment utilization, and the data flow generated by massive devices and sensors is fragmented, making it difficult to connect and share, and it is difficult to activate the value of data.
The root cause of these problems lies in the lack of digital representation and effective circulation mechanisms for devices and data in the physical world. Therefore, there is an urgent need for a set of economic infrastructure for the Internet of Things to solve the problems of equipment fragmentation and data isolation, and realize the digital management and circulation of assets. IoTeX's solutions enable developers of various IoT ecosystems, sharing economy, smart home, autonomous driving, supply chain, and more to build their own DePIN applications.
IoTeX built the entire blockchain and IoT middleware from the ground up, and launched several blockchain-powered IoT products.
Some of the successful products supported by IoTeX:
- Ucam: Ucam is the world's first home security camera developed by IoTeX in partnership with Tenvis to provide users with privacy and data ownership using decentralized identity. Tenvis is a hardware giant that is currently Amazon's camera pick-up brand.
- Pebble Tracker :P ebble Tracker is a decentralized asset tracking device developed by IoTeX in partnership with Nordic Semiconductor, one of the world's largest chipmakers. Paired with Edge Oracle, Pebble Tracker writes verifiable real-world IoT data (e.g., location, movement, climate) to the blockchain for use in smart contracts and is now available on Mouser Electronics.
- DIMO is a DePIN mobility program that focuses on collecting car data, analyzing it, and providing value-added services to car owners. In April 2023, DIMO announced that it will integrate W3bstream, a blockchain IoT middleware developed by IoTeX, to connect data from connected vehicles to smart contracts, help Web3 developers easily access zero-party mobile data, and support the incubation of revolutionary mobility Dapps, allowing consumers and fleet operators to truly own and control the data generated by their vehicles
IoTeX participates in the following programs:
- Automotive & Supply Chain Pilot: Leverage Pebble Tracker technology in partnership with MOBI, the U.S. Navy, and the Industrial Internet of Things Consortium (IIC).
- Blockchain Standards: Developed within the IEEE and the Confidential Computing Consortium (CCC).
Tokenomics
In June 2022, the IoTeX mainnet and its native token, $IOTX, were officially launched. IOTX is the native utility token of the IoTeX blockchain network (IoTeX L1 + IoTeX W3bstream). It plays a variety of functions within the IoTeX ecosystem, including gas fees, burning certified real-world devices, network governance, and staking services. IOTX is already listed on major cryptocurrency exchanges, including Coinbase, Binance, Gemini, Upbit, Kucoin, Crypto.com, and more.
Token basics
Token supply
- Total Supply: 9,442,702,397
- Total Circulation: 9,442,702,392 (as of date)
- Pre-sale Price: 1 IOTX = 0.0000125 ETH(≈$0.0083)
- Public Sale Price: No Public Sale
Initial distribution and release of tokens
The initial token distribution is broadly divided into five main parts: IoTeX Foundation (25%), Private Sale (24%), Community Rewards Program (6%), Ecosystem (30%, including Ecosystem Development and Roll-DPoS Mining), and Team (15%). These tokens are gradually unlocked over the next three years of launch, with full release by the end of 2022.
Token usage scenarios
Bitcoin's proof-of-work was an early form of DePIN verification. It utilizes a large amount of computing power to ensure security, and every node in the global Bitcoin network participates in validation. Today, DePIN verification uses a similar philosophy, where participants can leverage the network by leveraging the services of the infrastructure they have, resulting in fees and rewards.
IoTeX becomes a DePIN modular facility provider by providing middleware and hardware, and all DePIN projects built on IoTeX will be participants in the IOTX token economy.
IOTX serves a variety of purposes, with the goal of enabling trusted and transparent interactions between various entities in the IoTeX network, including representatives, stakeholders, product builders, service providers, and consumers. Key uses include:
- Gas fees: IOTX is used to pay for transaction/contract fees on the IoTeX network
- Staking Governance: Staking tokens participate in voting governance
- Staking services
- Device registration: Register a trusted device by staking or destroying it
Token economic model
- Burn - drop
When the first 1 million devices supported by IoTeX reach the first 1 million, a total of 1 billion IOTX (10% of the total supply) will be burn-dropped, of which 900 million will be burned and 100 million will be delivered (e.g., distributed to voters with an auto-subscription time of ≥ 91 days).
This process will be driven by smart contracts, and a new "Burn-Drop" plan will be automatically executed every time a new onboarding device reaches a certain number of devices.
- Burn-to-Certify
Once the Burn-Drop phase is complete, the Burn-to-Certify mechanism will be activated. Device manufacturers earn "Powered by IoTeX (PBI)" certificates by burning IOTX, and PBI devices receive monthly token yields, which are derived from transaction fees paid by other devices.
The IoTeX team and funding
Meet the team
Headquartered in Silicon Valley, IoTeX is a team of more than 30 top engineers and scientists from Uber, Google, Intel, Facebook, and other top tech companies. Currently, the platform is maintained by more than 60 global representatives, including Blockfolio, CoinGecko, DraperDragon, and more.
Founding member
- Raullen Chai: Co-founder and CEO of IoTeX, Ph.D. in Computer Science from the University of Waterloo. He used to be the head of encryption research and development at Uber and the technical director of Google.
- Qevan Guo: Co-founder of IoTeX, PhD in Machine Xi and Computer Vision at the National University of Singapore. Former head of product at Facebook.
- Xinxin Fan: Co-founder of IoTeX, Ph.D. in cryptography from the University of Waterloo. Worked as a Senior Research Scientist at Bosch.
- Jing Sun: Co-founder of IoTeX, previously served as managing partner at Sparkland Capital, a Silicon Valley venture capital firm.
Principal Advisor
- Robert Parker: Samsung SmartThings 前 CTO、Amazon Alexa 创始总监、Microsoft 总经理、IoT 行业获奖领头人
- Daniel Mason: Co-founder of Spring Labs, the leading data exchange platform for the financial industry
- Ken Seiff: Blockchange Ventures 管理合伙人
- Anoop Nannra: AWS Global Blockchain Leader, IIC DLT Working Group Co-Chair, and former Global Blockchain Lead at Cisco
- Michael (Minsik) Cho: Director of the Board of Directors of Upbit and Kakao Corp, Founding Member of KPMG Korea
- Robert Wolff: Arm Chief Developer Evangelist, Blockchain & IoT KOL
- A.D: Principal Development Mentor at Google
- Mitch Tseng: Principal of the Industrial Internet Consortium (IIC) Testbed Committee and Innovation Working Group
Investors
当前投资方: Samsung NEXT, Draper, GoodWater, Jump, Wintermute, EV3, Hashkey, Blockchange, IOSG, Hanwha, Wemade, NGC, Hashed, Kenetic, Xoogler.
Financing
- In early 2018, top venture capital firms raised about $30 million.
In May 2022, MachineFi Lab closed a $10 million seed round at a $100 million valuation.
In June 2022, MachineFi Lab continued to lead the round with a $50 million Series A funding round.
Write at the end
The distributed and immutable nature of blockchain technology, as well as the connectivity and data exchange capabilities of the Internet of Things, bring great potential to create revolutionary IoT projects. At present, the vast majority of IoT devices operate in a centralized mode, which is contrary to their decentralized nature. As a result, many problems have arisen, such as limited scalability, high operating costs, frequent privacy issues, prominent security risks, and lack of use value. Blockchain, with its inherent characteristics of decentralization, can fully solve the problems of the current Internet of Things.
However, the opportunities presented by blockchain do not mean that any blockchain is suitable for the Internet of Things. In fact, due to a number of challenges, none of the existing public blockchains can be applied to the Internet of Things. In 2015, the IOTA blockchain, which was created specifically for the Internet of Things, gained market attention as soon as it was launched, and at one point it rose to the fourth place in terms of market capitalization. IOTA covered the most attractive concepts at the time - IoT application scenarios, a new DAG (directed acyclic graph) block structure, and low-fee micro-settlement. IOTA's technological innovation and futuristic sense of the scenario were very attractive, but the development came to a standstill due to the immaturity of the technology and incentive mechanisms.
Now, after years of development, blockchain technology and IoT devices and data have increased dramatically, and DePIN has a more solid foundation today as a bridge between devices in the physical world and Web3. As a rising star on the DePIN track, IoTeX is expected to leverage DePIN by providing underlying facilities. Founded in 2017, IoTeX has a top team and technology, and has made great progress in R&D and practical application after two cycles of dormancy, which shows the determination and strength of the project in this field. Future Money will continue to follow up and study the IoTeX and DePIN tracks in the future.