How profitable is it to run decentralized infrastructure? Looked at profit margins for Decentralized Physical Infrastructure Networks (DePINs):
For ๐๐ถ๐ด๐ถ๐๐ฎ๐น ๐ฅ๐ฒ๐๐ผ๐๐ฟ๐ฐ๐ฒ ๐ก๐ฒ๐๐๐ผ๐ฟ๐ธ๐ (๐๐ฅ๐ก๐), reward based profit margins range from 0% to 200%. ๐๐ฅ๐ก๐ ๐๐ต๐ฎ๐ ๐ผ๐ณ๐ณ๐ฒ๐ฟ ๐ฑ๐ฒ๐น๐ฒ๐ด๐ฎ๐๐ฒ๐ฑ ๐๐๐ฎ๐ธ๐ถ๐ป๐ด ๐๐ฒ๐ป๐ฑ ๐๐ผ ๐ต๐ฎ๐๐ฒ ๐ต๐ถ๐ด๐ต๐ฒ๐ฟ ๐ฝ๐ฟ๐ผ๐ณ๐ถ๐ ๐บ๐ฎ๐ฟ๐ด๐ถ๐ป๐, e.g., Livepeer, The Graph, Filecoin, and Covalent.
In contrast, ๐ฃ๐ต๐๐๐ถ๐ฐ๐ฎ๐น ๐ฅ๐ฒ๐๐ผ๐๐ฟ๐ฐ๐ฒ ๐ก๐ฒ๐๐๐ผ๐ฟ๐ธ๐ (๐ฃ๐ฅ๐ก๐) typically achieve:
โข ~๐ฑ๐ฌ% profit margins ๐ณ๐ผ๐ฟ ๐๐ผ๐-๐๐ผ๐๐ ๐ก๐ผ๐ฑ๐ฒ๐: e.g., Dimo, Helium, or Arkreen where nodes cost several hundred dollars at most.
โข ~๐ฎ๐ฌ๐ฌ% ๐ฎ๐ป๐ฑ ๐ฎ๐ฏ๐ผ๐๐ฒ profit margins ๐ณ๐ผ๐ฟ ๐๐ถ๐ด๐ต๐ฒ๐ฟ-๐๐ผ๐๐ ๐ก๐ผ๐ฑ๐ฒ๐: e.g., Helium Mobile, XNET, WeatherXM, Hivemapper, and GEODNET, where the nodes start at $400.
For details and assumptions, check my full research w/ @KoschigRobert (@1kxnetwork ) and @dylangbane (@MessariCrypto) on token rewards in DePINs:
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