Decentralized physical infrastructure networks (DePIN) tokenomics

This paper provides a rigorous academic analysis of the economic models underpinning Decentralized Physical Infrastructure Networks (DePIN). By examining the dual-sided market mechanics involving supply-side hardware providers and demand-side end-users, the authors explore how token incentives act as a bootstrap mechanism for network growth. The research focuses on the 'cold start' problem and the transition from hyper-inflationary reward structures to sustainable revenue models. Through quantitative modeling, the paper evaluates how different token distribution mechanisms impact long-term network security and decentralized governance. It highlights the inherent trade-offs between capital efficiency and network decentralization, offering a framework for designing incentive layers that align physical hardware deployment with protocol-level goals. The work is significant for its formalization of token velocity, supply-side elasticity, and the impact of hardware depreciation on protocol solvency, bridging traditional supply chain economics with cryptographic incentive design.