Crypto AI Series: DCNs
Decentralized Compute Networks
It’s the 58th edition of The Gems Corner, and we’ll continue the series on Crypto AI. This issue will focus on the rise of decentralized compute and other alphas.
Decentralized Compute Networks
Artificial Intelligence is one of the fastest-growing and most profitable industries with companies like Nvidia and OpenAI leading the charts. Also, the AI market size is expected to exceed $826 billion by 2030, signaling explosive growth.
Amidst this growth, we are also witnessing the rise of decentralized compute networks (DCNs). These networks are redefining the very fabric of computational power distribution, unlocking new potentials in efficiency, security, and scalability.
This newsletter delves into the essence of DCNs and highlights the top projects front-running this narrative. The Essence of Decentralized Compute Networks
What are DCNs?
Decentralized computing networks are a paradigm shift from the traditional centralized model of computing. In a DCN, computational tasks are distributed across a network of nodes, each contributing resources to perform complex computations collectively.
These networks close the demand-supply gaps and provide competitive pricing by utilizing unused global computing resources through peer-to-peer aggregation platforms.
AI models require significant GPU power because they’re foundational for today’s generative AI era. GPUs have three core functionalities: employing parallel processing, scaling supercomputing heights, and setting up a broad and deep AI software stack.
The demand for GPUs is outstripping supply, and DCNs are positioned to democratize GPU services at affordable rates. In fact, the GPU market is growing at an annual rate of 33.2 percent and is set to hit $274.2B by 2029.
The Mechanics of DCNs
At their core, DCNs leverage blockchain technology and distributed ledger principles to create a trustless environment where nodes can collaborate without centralized oversight. Here’s how it works:
Task Distribution: Computational tasks are broken down into smaller units and distributed across various nodes in the network.
Resource Utilization: Nodes contribute processing power, storage, and bandwidth to execute these tasks.
Consensus Mechanisms: DCNs employ sophisticated consensus algorithms to ensure accurate and reliable computation results.
Incentive Structures: Participants (nodes) are incentivized through token rewards, fostering a robust and active network.
Why DCNs Matter
Enhanced Security: By decentralizing computational resources, DCNs reduce the risk of single points of failure and malicious attacks.
Cost Efficiency: DCNs leverage underutilized resources, reducing the overall cost of computation. For instance, GPT-3 training cost ranges from $500,000 to $4.6 million, depending on hardware assumptions. And, it cost OpenAI more than $700K/day.
Scalability: The distributed nature of DCNs allows for seamless scaling as more nodes join the network.
Inclusivity: DCNs democratize access to computational power, enabling individuals and smaller entities to participate in and benefit from high-performance computing.
Fast-Emerging Decentralized Compute Networks
1. IO.NET
io.net is building an enterprise-grade decentralized computing network that allows machine learning engineers to access distributed cloud clusters at a small fraction of the cost of comparable centralized services. In simple terms, they’re democratizing access to GPUs.
They’re able to achieve this by aggregating GPUs from underutilized sources like crypto miners, data centers, and hardware networks like Filecoin & Render. This enables them to give engineers access to massive amounts of on-demand computing power in a system that is accessible, customizable, cost-efficient, and easy to implement.
Nosana is a platform that provides AI users with affordable GPUs and GPU owners with an income. GPU owners can rent their GPUs to AI users, who in turn can access powerful hardware and train and use their models faster.
They are also taking advantage of underutilized hardware, such as gaming PCs, miners, and MacBooks, and offering competitive prices for building and running AI-solutions.
Think of Flux as the Amazon Web Services (AWS) for blockchain. The Flux Ecosystem is a suite of decentralized computing services and blockchain-as-a-service solutions that offers an interoperable, decentralized, AWS-like development environment.
In addition, they provide decentralized computing power, making it possible to deploy any app, website, or blockchain project with enhanced security and redundancy.
4. Fluence DAO
Fluence is an innovative cloud computing DePIN platform that frees computation from centralized clouds by offering natively decentralized, low-cost, and verifiable compute. They’re disrupting a potential $90 billion market with an affordable and superior solution.
Additionally, Fluence aggregates CPU resources from top-tier data centers around the world in global & resilient ways on a DePIN platform. This is a huge leap in computing, enabling companies to escape subjective censorship and data lock-in.
Other worthy mentions:
Alpha Bites and Tweets
That’s a wrap.
Thanks for reading!
Viktor DeFi.
PS: I’d love to hear your feedback and comments.
That's a powerful knowledge and indeed came at the right time. The projections, the statistics and the attributes. Well written piece!