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New Report Identifies AI and NodeFi as Future Frontiers of DeFi
AI and NodeFi: The Future of Decentralized Finance
Artificial Intelligence Poised for Growth
A recent report by Nansen and MetaStreet highlights the potential of artificial intelligence (AI) and NodeFi in the decentralized finance (DeFi) space. The analysis suggests that these emerging verticals may shape the future of cryptocurrency markets.
Evolution Beyond Traditional DeFi
Titled “Beyond DeFi,” the report indicates a shift away from ERC-20 tokens and traditional DeFi applications. Instead, new sectors like distributed computing and GPU-as-a-service are expected to gain traction as the market evolves.
DePIN Projects and GPU Rental Services
Decentralized Physical Infrastructure Networks
The report points to the promise of Decentralized Physical Infrastructure Networks (DePIN) projects, particularly in distributed computing. With the GPU-as-a-service market valued at $3.2 billion in 2023, blockchain-based GPU rental services could tap into the growing demand for AI model training.
AI Compute: The Next Major Vertical
The analysis suggests that AI-related compute DePIN is positioned for significant growth, offering high yields, predictable asset prices, and low implementation complexity. This sector holds the potential to become a major player in the DeFi space.
Exploring NodeFi and Other Verticals
NodeFi Incentive System
NodeFi, an incentive system for node operators, is identified as another area with potential in the DeFi landscape. While success may vary among projects, NodeFi presents opportunities for innovation and growth.
Challenges in NFTs, Gaming Assets, and RWAs
While NFTs, gaming/metaverse assets, and real-world assets (RWAs) show promise, they face challenges related to asset volatility, yield sustainability, and regulatory complexity. These sectors require careful navigation to realize their full potential.
Long-Term Potential of AI and Blockchain
Major tech firms continue to invest heavily in AI development, highlighting the long-term potential of AI and blockchain technologies. The intersection of these fields could lead to breakthrough innovations in the DeFi space.
Future Growth Opportunities in DeFi
As DeFi expands beyond its current boundaries, tapping into real-world demand drivers like AI compute could offer sustainable sources of yield and growth. However, integrating these new asset types with existing DeFi infrastructure will require innovative solutions.