Utility is a perennial problem in Web3. While most agree that the blockchain and the decentralization of technology are interesting ideas with huge potential, few have figured out how to apply these ideas in the real world.

Decentralized physical infrastructure networks—or DePINs, as they prefer to be known—are bridging this divide. Enabling the tangible application of Web3 technology, DePINs are showing how decentralization can improve telecommunications, wireless connectivity, transportation, agriculture, and even healthcare.

One such project is Chirp Network, which is expanding wireless connectivity throughout Europe and beyond via physical routers that anyone can place outside their homes to provide connectivity in return for token rewards. These "BlackBird" gateway devices are connecting homes and businesses to a powerful, decentralized Internet of Things network with infinite potential for expansion.

This IoT network can be used to connect any number of devices that provide crucial infrastructure: climate control for fleets of food or medical supply vehicles, traffic control devices, agricultural sensors, and more. And, unlike traditional, centralized networks that rely on just a handful of physical sites to deliver connectivity, due to its locational diversity a DePIN will rarely—if ever—go down. 

Indeed, such is the potential of this kind of technology that businesses and governments all over the world are beginning to experiment with DePINs and Web3 technology. In Germany, for example, a public-private partnership has been launched to explore the practical applications of blockchain technology through cross-sector and cross-industry collaborations.

Led by the German zero-trust network for IoT devices Staex, the NEXA consortium consists of established Web3 companies, including Chirp Network, Vantage Towers, REWE Group's payment tools, Lisk, Germandrones, and Berlin Partner für Wirtschaft und Technologie.

NEXA's members will share assets and data, co-manage permits and contracts, and facilitate blockchain-based payments to bring machine-based innovation to sectors across the German economy.

On Tuesday, 21 May, Dr. Severin Fischer, German Secretary of State for the Senate Department for Economic Affairs, Energy and Public Enterprises, inaugurated the partnership by opening a launch event for a Web3 drone corridor in Berlin's Marienpark.

Speaking at the event, Dr. Fischer said that the NEXA members plan to transform Berlin into the "number one innovation hub in Europe." He added that 'Made in Berlin'—technologies such as drones, Web3 infrastructure, mobile communications, and mobile payment services—have "enormous economic potential for the coming years."

Another recently launched public-private initiative in the DePIN space is between the Tuzla Municipality in Romania and the ARAX blockchain. Through this partnership, the Romanian government intends to transform the small coastal city of Tuzla into a smart city by utilizing the DePIN platform economy with the help of ARAX's blockchain, IoT, and AI technologies.

Some of the many infrastructure challenges the municipality hopes to address through its partnership with ARAX include intelligent street light management, decentralized connectivity, utility meter asset management, waste management, renewable energy consumption, decentralized data storage for reporting, and the management of supplying and distributing commodities.

Meanwhile, Helium, another DePIN in the telecommunications space, launched a partnership with the government of San Jose in California in 2022. The partnership aimed to build a "People's Network" through the installation of hotspots in people's homes and businesses that can connect to small devices such as GPS trackers, environmental sensors, and cameras.

As part of the six-month pilot program, the city obtained 20 of Helium's wireless hotspots. Using devices like GPS trackers and air-quality sensors connected to these wireless hotspots, the city planned to mine Helium's proprietary cryptocurrency, HNT, and use the proceeds to cover the internet bills of 1,300 low-income households.

Sadly, the project was not a success. Despite deploying more than 500,000 hotspots globally, Helium's network failed to create much revenue—only generating enough to cover 86 homes. Nonetheless, the project provided an interesting test case that can and is fuelling further development.

Beyond the DePIN space, governments have also been exploring the application of Web3 technology in finance. To date, one of the most notable partnerships has been between the Monetary Authority of Singapore (MAS) and a consortium of banks exploring the tokenization of real-world assets.

Named "Project Guardian," under the first industry pilot in 2022, DBS Bank, JP Morgan, and SBI Digital Asset Holdings conducted foreign exchange and government bond transactions against liquidity pools of tokenized Singapore Government Securities Bonds, Japanese Government Bonds, Japanese Yen (JPY), and Singapore Dollars (SGD).

As part of the launch, a live trade involving tokenized JPY and SGD deposits was successfully conducted under a bilateral commercial arrangement to recognize zero profit and loss based on mutually agreed transaction terms. In addition, a simulated exercise was performed involving the buying and selling of tokenized government bonds.

However, while finance is a prominent area in the digital asset space, DePINs are providing the most promising avenue for the application of Web3 technology in the real world. While Helium's project was not a success, the potential of DePINs for local authorities remains manifest. 

Especially through the expansion of connectivity, DePINs can address some of our greatest infrastructure challenges—from increasing the security of our homes and businesses to safeguarding our food chains and ensuring universal access to healthcare. Because of the many advantages DePINs offer, it is likely we will see more and more local administrations exploring this innovative new area of Web3.