Helium’s Previous DePIN Story: Bitcoin, Arweave, and STEPN
This article, sourced from an article titled “Helium’s Previous DePIN Story: Bitcoin, Arweave, and STEPN” by Mr. Zuo, is compiled, translated, and written by Deep Tide.
Summary:
Helium’s ecological token has been on the rise! MOBILE, IOT, HNT, and DATA all surged by 90%.
Background:
Helium Mobile combats “professional mining and selling”: MOBILE token rewards can only be claimed after eight days of subscription.
Table of Contents:
Messari’s Retroactive Naming: The Origin of DePIN
The Sanctity of Physical Hardware
Arweave&FIL: Long-termism vs Short-term Speculation
Helium represents a specialized DePIN narrative, but before that, there were at least three important contributions that, together with specialized hardware, constitute the main part of the next DePIN narrative.
The Sanctity of Physical Hardware: Bitcoin and PoW Mechanism
FIL&AR: Regular Hardware + Web3 Incentive Layer
STEPN: Out-of-the-box Mechanism + “Expected Cash Flow Discount” Selling Mechanism
Helium’s revival did not begin in December but in July when it was listed on Coinbase. Prior to this, DePIN had received some market attention, but Helium had already been hit by price drops and repeated complaints from miners. The feeling of being overshadowed remained.
Today, discussing Helium cannot be separated from 5G mobile plans. This has successfully attracted users with real needs, rather than viewing it as a financial game. It requires a sufficient number of users forming a substantial holding group to counteract the downward pressure from selling. The rumored Martian and Sun brothers’ exchange of tokens was essentially a variation of selling and redeeming.
Analogous to the relationship between StepN and various X2E projects, the DePIN (decentralized physical infrastructure) name came after the “IoT/ICT/AIoT + blockchain transformation” projects. Helium plays a supporting role. If Helium were to fail, then DePIN would struggle as well. However, Helium has been struggling but remains resilient. Later projects only need slight improvements to survive:
Micro-innovation: Improving on the basis of the leading Helium project, similar to how WiFi is to 5G and satellites are to ground-based systems.
Changing scenarios: Copying the Helium model but switching to different fields, such as Virtual Power Plant (VPP) Starpower and green energy Arkreen.
To fully understand the name DePIN, we need to continue recognizing actual projects. The most important aspect of DePIN is hardware, not blockchain (software). Therefore, a rough division includes both hardware and chain:
2007/8/9: Various Bitcoin mining machines were developed, from personal CPUs to ASICs, establishing their reputation as energy consumers.
2014: Filecoin’s model emerged, gradually attracting the attention of Huaqiangbei. Its price soared, and its relationship with the initial design of data storage became less significant while its relationship with mining and earning tokens grew.
2017: IoTeX was established. Of course, it was not prominent among many public chains at the time. It was more of a lingering effect of the chain transformation frenzy. Now, it can be mentioned purely by chance.
2021: Helium reached its all-time high at $50, although it is not as impressive as Ethereum during the same period, comparing it to Ethereum now reveals its terrifying nature.
End of 2022, Messari started to gain recognition, and the name DePIN was officially established.
Messari divides it into four major sectors: server networks, wireless networks, sensor networks, and energy networks. It is basically a combination of off-chain data generation and on-chain data confirmation. The core lies in the confirmation of rights and the economies of scale. The requirements for anonymity, decentralization, and extreme “full-chain execution” are not high.
Furthermore, the classification inside is too complicated. For example, decentralized databases (DDB), although they involve hard drives at the underlying level, the relationship between modern databases and underlying hardware has already been greatly decoupled. Forced classification raises suspicions of word count filling.
If I were to categorize, DePIN must meet two requirements. The first is customized hardware, such as Helium. The second is a dedicated incentive layer that transforms or integrates common hardware into the Web3 network, such as Render Network, which allows individuals to sell their idle GPUs to others.
Although Bitcoin has long been criticized for its energy consumption, when we think about it the other way around, it sets a benchmark for basic pricing. The electricity consumed represents the burning of civilization, where one unit of electricity is equivalent to one beam of light illuminating the value of Bitcoin.
As Ethereum transitions to PoS, the debate has become increasingly intense. Environmental friendliness is not only correct but also politically correct. However, PoW, specifically the workload of physical hardware, has advantages that PoS cannot provide—a connection to the physical world and the ability to migrate that connection.
Although OFAC may not necessarily be able to control the Ethereum network, it definitely cannot control the Bitcoin network. This is the difference between the two. I call it the sanctity of physical hardware. Under the dominance of virtualization technology, only Bitcoin can persist.
Next is the recognition of the great power of creating an incentive layer for FIL&Arweave based on existing physical hardware. FIL’s madness goes without saying. If you’re interested, you can talk to a miner and hear their bitter tears about the miserable history of being repeatedly harvested by FIL.
Arweave’s importance, on the other hand, has long been unrecognized by the market. In my opinion, AR represents a classic model where a not-so-successful project can survive. Although AR has recently made headlines due to an internal conflict, it still has a significant difference in terms of node quantity, network scale, and data storage compared to FIL. However, AR can continue to survive because the current Web3 is still a realm of niche demand and a large amount of hot money, and maintenance costs are not high.
As long as the project team is not overly extravagant, most projects, especially public chain-level projects, can survive.
The difficulty lies in breaking out. In this regard, Helium has successfully “harvested” a wave of old miners. What is currently popular is Helium 5G, not the original Helium WiFi mode. The only project that has successfully transitioned to Web 2 is STEPN. STEPN, DePIN, and Bitcoin mining machines are similar in that they combine “expected cash flow discount + hardware targets.” The only difference is that STEPN is dedicated to fitness, which is a demand not only for the Web3 community but also a large market worldwide. Even without returns, there will still be a demand for fitness.
STEPN: Fitness market, providing incentives in addition to daily fitness
Specialized DePIN: Web3 mining market, mining coins and selling, hardware can only do one thing
General-purpose hardware + additional incentives: Can be hyped like FIL, slowly gaining recognition like Arweave
This is not to promote a certain model but to say, “Before participating in mining, understand what your needs are, apart from speculation and mining.” If there is a genuine need for fitness, it is not too late to participate in STEPN. However, it is dangerous to spend $999 on Web3 WiFi because normal people wouldn’t do that.
Related Reports:
What is DePIN? Decentralized Hardware-led New Data Economy
Is DePIN the Dark Horse in the Next Web3? Hear What the Leading Projects Say
Drive to earn? In-depth analysis of the business model of Dimo, a DePIN project
Tags:
Arweave
DePIN
FIL
STEPN