State of DePIN 2024 - Alex Mukhin | Cryptomeria Capital

okay perfect so uh guys anybody still alive uh cool so I'm really happy to see all you here uh I'm really happy to be here in belgrad and today we are going to talk a little bit about probably one of the uh hottest topic nowadays in our industry and of course uh it's going to be a discussion about the pin so but let me start with short introduction regarding myself so uh I'm co-founder of group of companies we have three main businesses the core is our investment fund the name is Crypt Mar Capital we invest in different blockchain crypto projects all the world mostly in pred and Seed so if you're a builder uh if you're a Founder you need Investments please uh feel free uh to reach me to find me I'll be really happy to talk with you also we have our Media Group we have a media and post it's Global media it has over FR laners per month most information in Europe we cover some news updates about web free AI uh mete Etc and last but least I call it cherry on the top it's about our gaming project which name is satosi universe so satosi universe is the biggest entertainment project in linear ecosystem so in our investment fund we have very experienced R&D department and we do issue a lot of reports a lot of Publications about uh different tops TOS mostly we do it in way of public good and recently just two months ago we have issued the biggest repord about the pin about our industry and in our industry so it covers actually a lot of topics uh it has a lot of alpha of course it's completely impossible to dive deep into you know so big uh publication over just 20 minutes so today what we are going to do we are going to briefly fly through it as soon as you want some you know uh hardcore Tech please feel free to find the digital version of this rer and check it out so what we see here we see a lot of colorful blocks a lot of icons so what does it mean actually it means the pin ecosystem is growing the pain ecosystem is growing really fast we find a lot of new comer lot new projects literally every day but let me just start with kind of short introduction I don't understand the belgrad is mostly about tech audience but anyway I do believe uh some of you uh don't know much about what is the PIN so how we identify the pen so for us in the current Global Tech landscape we see a lot of big companies a lot of tech Giants and a lot of them they actually trying trying to monopolize the whole industry at the same time the pin is going to leverage principles of decentralization can solve this kind of issue and provide more fair more transparent solutions for the end user right now we are in a kind of momentum we are in this momentum because of two key points the first one is of course it's kind of a hype a l of people I hyped around AI ML and so on on one hand on the other hand we see we are entering the age of uh you know General maturity of the technology so in this kind of Age Technology maturity and hype around Ai and ml we see the global arise of the pin and of course as soon as we see this match we see a huge impact on a uh concentrated market cap of this kind of project so the pin has several sectors and what we are going right now we are going to just go one by one and talk a little bit more about each of that and we are going to start with storage so probably the centralized storage is one of the most well-known thein case it has a lot of well-known names and the thing is right now we can State we are in the age of cloud transformation as you see on this slide over 60% of all corporate data are stored in the cloud but the interesting fact is just half of sensitive data is encrypted properly and as well we see a significant lack of understanding the principles of the centralized storage and what kind of value it can bring for organizations a lot of Corporations actually even Tech Giants they have cloud or hybrid hybrid Cloud strategies and uh in this way we expect decentralized projects decentralized storage can bring a lot of value and in this age of cloud transformation uh we are at a fund where as our R&D Center we are uh pretty confident this uh projects will be in the far front of this Cloud transformation another one is Computing of course this is one of the probably uh most well-known sector nowadays probably even hyped sector I do promise it's not the most hyped slide uh the most hyped slide will be uh soon uh but anyway you see a lot of well-known projects and these projects they literally drive this aggregated market cap of the whole the pin sector a lot of these projects what they are going to do each of them right now is going to focus on specific specific use case and uh each of them are going to solve specific uh use case and of course as soon as we have a global arise of the interest of AI we see it has a positive effect on onchain Revenue which can be observed in these protocols and of course as soon as we see it it drives this adoption uh in a pretty obvious way way by the way the kind of interesting or even fun fact is as soon as you need to run some gpus right now for you it's much cheaper to run the gpus on the centralized platform than the uh centralized platforms of course right now as soon as we talk about Cloud uh Compu is we talk about the centralized Computing we see a lot of challenges on on the one hand it's about the general education regarding advantages of these kind of Solutions on the other hand it's about kind of security challenges so on so on so on so on but we see these projects are going to invest to solve these challenges and uh for now uh the trend is obvious and uh we can State it's even Unstoppable another thing is the wireless so we are right now let's say in the age of U 5G transformation as soon as we are in the age of 5G transformation even in 2020 uh3 we observed kind of cooling off of this growth of this adoption um the general Global trend is growing and as soon as you are creating any project any solution any product in a growing industry itself you will observe more and more support uh your product will find uh for now we see and we can State it's not probably um really um good case a lot of projects especially in a wireless sector they use the power of the web free in a way to motivate users to engage users to boost user retention from our vision in next three or five years we'll see more and more web free implementation implementation of the power of a free on the infrastructure side and it's quite important if we want to have to see this sector in a growing trend you see actually a lot of cases in this slide and right now again we do believe we'll see more and more merge regarding this sector and web free on infrastructure side not only on uh the side of uh uh user engagement and user retention sensors is quite um in the same situation so we see that the current value of this Market is around4 billion US do and definitely it's growing and the quite interesting fact is since uh 2020 we see that uh iot devices are outnumbering non iot devices and of course the centralized uh sensor products will play and already are playing significant role in this kind of trend we already see a lot of cases for now for now we can State they just kind of you know early birds I do believe actually a lot of you even are not familiar with some devices you see in this slide and uh they just let's say the first wave of this kind of products and here we are uh one of the most hyped uh slid finally so actually very honest a lot of words have been already said about AI from different from different uh well-known people in our industry so I definitely don't want to spend a lot of time uh there but we definitely see that you know the general interest for AI is it's going to boost some you know um corresponding sectors so it boosts the um aggregated market cap and aggregated growing of aggregated market cap is boosting um interest for this kind of sector in retail users uh so we do expect a huge interest there as well and the last one list I just checked the agenda and I realized you have have a lot of panels a lot of discussions regarding der knowledge and yeah this is really awesome me personally I do believe D knowledge is going to transform not only our industry but the whole TCH industry in different ways in next five 7 10 years we'll see more and more and more interesting cases um the thing is very unfortunately as soon as we talk about the pin just a few of people they mention their knowledge but actually there are a lot of use cases uh regarding both sectors so for example uh decentralized storages are playing literally a crucial role at a backup infrastructure another use case is a lot of the uh the pin Solutions can be used as external data availability year for different blockchains and we see a lot of different cases around that so for now we cannot find and we cannot identify let's say the leader in this direction but I do believe we'll see more and more well-known cases really soon and yeah this is the last slide of course in a limited time it's completely impossible to dive really deep otherwise what we need to do we need to choose a specific sector and dive in deep to understand projects use cases Investments pros and cons as soon as any of you has specific questions I'll be really happy to have a discussion with you feel free to find me after this uh um keynote speech or just check our reper and last but not least in uh one month we are going to host our event in Brussel in Belgium we'll have some really nice thein uh discussion there some dein workshops so if you want some hardcore Tech please join thank you very much uh just hold on a sec Alex if anybody has any questions any questions for Alex just wait a second for the mic um hey I'm Ryan from W mobile token so you obviously um as a capital manager doing the incent um doing this talk you've done the research in due diligence tell me how do you feel about these projects incentivizing the role out of infrastructure with a speculative asset and not worrying about user acquisition and revenue first from what kind of perspective from an investor perspective from user perspective from let's say a community from what kind of angle as um to to help grow the the ecosystem deepend ecosystem as a whole so we can see like helium did a really good job at um understanding that the community want decentralized infrastructure but um it's it's kind of an interesting space that we're living in where people yes they want the decentralized infrastructure but they also want the speculation on the token side of things I don't actually care about the business model well so actually I think I just mention it during the presentation but let me just dive deep actually it's probably one of the most important thing we need to discuss uh because in um let's say web free industry we have two types of people uh we have the type of people I really care a lot about uh you know fundamentals they care a lot about user needs they care a lot about uh product design and we have another type of people and they care mostly about let's say economical aspect yeah uh regarding the token regarding the hype the attention and U very unfortunately in a lot of cases there is a obvious dismatch yeah uh and of course even as soon as uh we see the general growth of the crypto market capitalization we see more and more projects more more newcomers what they do they just uh grab some you know hot hashtags bum bum bum bum bum they collect it and we have let's say monsters we have DP airv AI uh blah blah blah blah blah the problem is obvious but at the same time if we just look back to the you know some fundamentals in the uh economy Theory we'll see the curve of innovation and as soon as we are in the beginning of this curve of Innovations we'll see some speculations we'll see some guys who are trying to focus not on fundamentals who are trying to just focus on marketing or trying to engage more and more users and they actually don't have a good product behind is it good or bad obviously it's bad but can we fight that can we Sol that I'm not sure cuz it's definitely not about web free only it's about the you know the state of innovation itself uh it happens in all Industries so what we see right now in thein sector we do see a lot of sustainable projects and um the thing is you know as soon as actually you build something for example um if you want to be successful you need to start uh cooking before the hype yeah you need to have an MVP you need to have a product to be super successful right now we see a big interest to the pin from the market but this let's say outliers uh which I mentioned during this presentation they have started their building two three four years ago they are not completely newcomers they have already invested a lot of time a lot of funds a lot of efforts um into this field so I would say and I would answer your question in this way uh products who are actually driving this sector right now they are doing really awesome job and uh they are not about using web free just to hype just to pump the token just to engage users they literally have a lot of um T behind them and they literally have a lot of nice use cases and they have proven use cases they work even with big corporations uh but of course as soon as we have something hyped we'll see even more products which are actually pretend to be products and what they're going to do they're going just to Hype so on a retail investor perspective even Institutional Investor perspective you need to be you know very careful about it and if we just compare we're going try to compare these kind of groups I would say for now we have literally and obviously less real projects but the value in terms of you know market capitalization and the value they actually bring the industry is much higher uh than a huge number of products they are going just to enter grab this hashtag and pretend to be um a right Builder did the answer yeah yeah yeah thank thanks for your answer um I follow-up question so um you know as an Enterprise investor what kind of advice would you give to people entering the the deep in space and what to look after and and what not to look out for very unfortunately I cannot provide just one um advice I need to provide several because we have several groups yeah we have Builders I have investors we have actually institutional investors retail investors uh we have community so there different aspects okay so for the uh founder perspective I would suggest to focus mostly on real cases and real um products because already right now we see a lot of outliers in the pin sector if you are going just to Hype if it's your strategy probably the pin is not the right place for you maybe you need to find something else cuz it's already quite you know complicated to compete with well-known and well established Brands so focus on real needs this is the first point the second point is you need to be really careful uh as a founder and you should understand that the case you are working on right now um it will not be solved by big well just in one month you know like for now in AI there are so many startups around but you know open eyes is do is going to issue a new product upgrade and they literally kill a lot of startups a lot of cool ideas even well funded so first of all check in what kind of competitor field and what kind of comp landscape you are working on regarding investor I will not provide any advices because this our Kno how I don't want to help our competitors to uh earn uh money uh just follow our strategy and our Twitter of course and uh regarding the community what I would suggest you know I do believe actually there is a huge potential uh to be part on uh in a real big story and there's a huge potential to be an early adopter uh in a big story as soon as you are an early adopter in a big story you have a really big advantages from different angles you can study more you can have economical benef benefits from different protocols whatever you can start uh your place as a team member of any protocol so my suggestion is to uh follow some well-known uh projects and to check uh in what kind of St stage did they fund rise in my opinion it's quite important so if we have just two more minutes I'll explain briefly we do you have five minutes perfect uh so I'll even provide uh more details the thing is a lot of startups especially in a web free industry what they are going to do they are trying to fundrise as much uh as they can uh in a preed stage in my opinion it's uh the worst the worst Str strategy you can have uh it's kind of uh you know one of the biggest risk you at the founder can get as soon as you fund drives as much as you can from day one uh for me it's quite important to follow startups projects which are going to fund rise in a very ecological way they really need this amount of funds and trust me even for very complicated products you don't have a huge burn rate you don't need crazy Investments for 90% of ideas it's quite cheap to build MVP so as soon as you Fund in a very ecological way you have an idea you need to build proof of concept you f rise directly to that you don't need to fund rise in day one for next 10 years but as soon as you have a pro of concept you can move forward you can fund rise more so um my suggestion is very fortunately we have a lot of different instruments in our industry so everything is quite transparent you can easily find and easily check exact valuation exactly amount of fund and the stage of the product they funded uh that days and as soon as you can uh do it you need to follow this kind of ecological ideas that's it thank you we have time for one more question if anyone has any all right give it up for Alex thank you for your insightful answer thank you guys