Whatever happened, happened. Now, we have to move forward.One of the areas where I see crypto having an edge is Proof of Physical Work.Why is this the case? Let's dive in 🧵
1/ During the week of the FTX saga, @Hivemapper launched.We will discover the benefits of Proof of Physical Work (PoPW) as we dive into Hivemapper.
2/ First of all, PoPW can be seen as incentivizing actors to do verifiable work that builds real-world infrastructure. Helium is the most successful PoPW-project thus far and builds a global, decentralized wireless network. Now, Hivemapper has set out to build a global map.
3/ 1) A key characteristic of PoPW is that crypto is not the product. The product offering is a tangible improvement over competitors - with crypto only as an element in its success.
4/ Founded by @aseidman, Hivemapper is building a global map. How do they do this? Dash-cams with token incentives. That's how we get to PoPW 2nd key characteristic.
5/ 2) PoPW solves the chicken-and-egg problem of networks. How to bootstrap supply when there is not yet demand?
6/ Give suppliers a token that _should_ go up over time as demand catches fire. When demand uses the network, their contributions burn the native token, decreasing supply.
7/ Drivers with a dashcam are incentivized through $HONEY tokens. Token payout is based on the local demand, coverage & freshness of the spatial data. When companies and users access the map, $HONEY token is burned and map credits minted.
8/ Let's examine for a sec how incumbents such as Google Maps and Apple Maps build Street View. Once every few years, a car with a full-spec camera comes past your street and records the surroundings.
9/That's how incumbents lose out on freshness. Below's a Google Maps' shot in downtown SF from Nov '15...
10/Hivemapper makes it possible to cheaply record and upload our daily ride home as a crowd-sourced map, making the freshness of data the killer-feature. Freshness makes way for businesses to make informed decision on logistics, deliveries and directions
11/ Let's talk about networks and how PoPW supercharges them:
As outlined in @cdixon’s thread below, token incentives offer the possibility to bootstrap networks.
Financial utility rewards supply-side from the get-go. Only then can demand start using the network for native utility.
12/ Despite the urge to supercharge networks, buildoors of PoPW networks do face a trade-off of decentralization vs. efficiency. Helium is the most developed PoPW project so let's have a look at their experience:
13/ Helium's "distribution"-layer of nodes is credible-neutral, and the 975K peoples-owned hotspots are based on open-source standards.
14/ While "execution"-layer is on a path of progressive decentralisation from @novalabs_ to @HeliumFndn, Helium's success remains highly dependent on the OG team. New parties such as @hexagonwireless and @hotspotty have emerged to build within the Helium ecosystem.
15/ PoPW can be divided into two categories:
1. fungible hardware is when location is irrelevant to the network.
16/ 2. for non-fungible hardware proximity between nodes and demand in the network does matter.
17/ What's next for PoPW? It remains to be seen which vertical will next see successful adoption, but let's leave a hint on where to look for: Helium and Render Network both attribute their success greatly to recent innovations:
18/-@helium_mobile builds 5G on the spectrum that only recently became available through CBRS.
-Render Networks plays the price arbitrage, where @nvidia charges consumer GPUs way lower prices than for AWS' data centres.
19/ These innovations wouldn't have changed competitor landscapes were they not combined with token incentives. Combined with novel innovation, that's where PoPW can have the greatest impact.
20/ Regulatory hurdles remain ahead. The Burn and Mint model used in PoPW projects could potentially be seen as security as its value is based on the net present value of future cash flows. Hopefully US regulation will be open for novel capital formation through crypto tokens.
21/Oh and on a personal note: one other reason I appreciate PoPW projects is that the founders of the top 3 projects are true visionaries within their verticals
eg. not catching the boat during the '21 bull run.
22/ @amirhaleem set out to build IoT networks with Helium in 2013. @JulesUrbach built world-class render software @OTOY and in 2009, he patented the token-based billing model for server-side rendering. @aseidman fell in love with maps back in 2007 while working for Yahoo Maps.