The Decentralized Physical Infrastructure Networks (DePIN) sector is experiencing notable growth

DePINs, split into Digital Resource Networks (DRNs) and Physical Resource Networks (PRNs), are evaluated for valuation drivers

The Decentralized Physical Infrastructure Networks (DePIN) sector has seen substantial growth, with over 25 projects now generating revenue, a report by Messari has found.

According to the report by the blockchain research firm, the sector's price-to-sales (P/S) ratio currently sits between that of base layer protocols and DeFi projects, which is an indication of a maturing market with increasing revenue.

DePINs, which are further divided into Digital Resource Networks (DRNs) and Physical Resource Networks (PRNs), were evaluated for valuation drivers, and the report, which was released in the fourth quarter of 2023, provides an analysis of 80 DePIN projects, of which 25 are known to be generating revenue.

The valuations were based on Fully Diluted Valuations (FDVs) and some revenue data may be skewed by inflationary token practices, and not all figures are verifiable on-chain.

DRNs vs. PRNs

Interestingly enough, despite both being part of the same decentralized infrastructure design space, there seems to be a valuation gap between DRNs and PRNs in the DePIN sector.

Specifically, DRNs are averaging an FDV of $132 million, which is 3.5 times higher than PRNs at $36 million. This disparity could suggest that markets treat DRNs and PRNs as economically distinct, potentially driven by differences in fundamentals like revenue.

For instance, Median DRN revenue was $1.5 million compared to $730k for PRNs in the first quarter of this year.

A Growing Market

Regardless of the disparity, the data already shows a growing DePIN market that surpassed $50 billion last year, and by some projections is estimated to reach $3.5 trillion by 2028.

The market encompasses around 350 tokens and that daily, over 13 million devices participate in DePIN operations across the globe. When it comes to blockchains, Solana leads in infrastructure while Base dominates in consumption and market share.

DePIN looks to be on the rise when it comes to venture and institutional capital as well. Last year, DePINs raised more than $350 million across Pre-Seed, Seed, and Series A rounds.

As DePIN projects continue to mature, their focus on real-world utility and revenue generation positions them as a compelling segment within the crypto ecosystem.