Ambreen Khral

Business Developement at Onchain Foundation

[Michał Moneta | Digital Cognition @michmoneta]

Sharing economy is still with us. It just transformed into DePIN.

Distributing our idle computing resources to people and companies in need looks like the most untapped Web3-related opportunity these days. Especially since some DePIN projects, such as https://t.co/gjQZNGuTJi, enable sharing the computing power of “ordinary” M2 chips from our Macbooks. Obviously, in exchange for monetary rewards 💵

Why do such projects still struggle so much with incentivizing both the supply (GPU power providers) and the demand side (GPU clients) of their business?

• Brand awareness (well, it’s likely that more people have heard of Google Cloud than of Render).
• Problems with supply-demand balance (scalability is drastically constrained if the supply side fails to meet demand).
• Limited target group potential (projects that are too focused on B2C get into the risk of having an “underutilized” platform – individuals benefit from DePIN usually way less than companies).

How to overcome these challenges? Check the link in the comments 💬

Image source: https://t.co/NwmgpKmSld litepaper.

[Michał Moneta | Digital Cognition @michmoneta]

How can Web3 companies generate recurring revenue?

By applying Web2 business models 👀

Obviously, more traditional revenue streams may not suit all the projects. And it’s not the only approach Web3 companies can use to generate money. However, Sweatcoin’s example shows that such a Web2 + Web3 combination can be very effective.

Sweatcoin is not a typical Web3 DePIN project. Their roots are in Web2, which is evident in their business model. Besides selling premium accounts (subscription model) and earning on commission from their SWEAT token (transaction fees model), they generate revenue through:

• In-app advertising and promotion of other brands – tailored to their fitness-oriented users.
• Brand affiliate deals through which people are able to spend their SWEAT tokens on various offers from partnering brands.

Sweatcoin also combines these streams with their specific incentive mechanism. It rewards users for watching in-app ads, for which the advertisers obviously had to pay:

1⃣ Users watch in-app ads.
2⃣ They receive SWEAT tokens.
3⃣ They use tokens to purchase products from affiliated brands.
4⃣ Every transaction generates fees.

In consequence:

📲 People become more incentivized to watch more ads.
🏅 Advertisers become happier with their Sweatcoin placements.
💰 Affiliated brands become more thrilled due to more purchases coming from the Sweatcoin app.

And eventually, Sweatcoin becomes wealthier and wealthier due to its Web3 + Web2 revenue cycle. Very smart indeed!

Credits: @OnchainHQ

[Arin @arin_onchain]

Let's do it! #DePIN #XSpaces 🔥