1. Project Introduction
Akash Network is a project in the field of blockchain and cloud computing. In essence, it is a decentralized cloud computing market that aims to make cloud computing more accessible and less expensive. The network runs on a blockchain-based platform, allowing users to rent out unused computing power or purchase computing resources at competitive prices. This model encourages more efficient use of global computing resources, potentially reducing waste and lowering costs for cloud service providers and consumers.
Akash Network was founded in 2015, launched its mainnet in the Cosmos ecosystem in 2020, and began supporting the GPU cloud market on August 31, 2023, further expanding its service scope.
Akash Network's supply side comes from data centers, miners, and consumer-grade computing power. Especially after the mainstream public chain turned to the PoS (Proof of Stake) mechanism, the idle computing power of a large number of mining farms has become a problem to be solved. Akash Network effectively utilizes these idle resources by cooperating with multiple large miners. Currently, there are more than 17,700 CPUs and 258 GPUs in the Akash network, and the number is still growing.
On the demand side, Akash Network is committed to attracting more developers to join its open source community and actively seeking cooperation with other decentralized AI protocols to expand its service scope and improve the competitiveness of the platform. For example, Akash has already reached partnerships with decentralized layer 1 protocols such as Gensyn and Bittensor, bringing a large amount of fixed demand to Akash.
Akash uses a reverse auction mechanism to match supply and demand. Its computing power is mainly used for data preprocessing and model reasoning, and it is also trying model training recently. Through the development of tools such as Cloudmos Deploy and Akash Console, Akash Network has taken a series of measures to reduce the difficulty of user use, including integrating Cosmos Swap on Metamask and supporting stablecoin payments, which greatly reduces the entry threshold for users.
In terms of token economics, AKT tokens play a key role in the Akash ecosystem, including as a staking medium to enhance network security, governance, leasing settlement units, and market pricing benchmarks. Supply and demand are regulated by setting different fee rates and inflation rates, while a portion of the revenue is allocated to the community pool for incentives and possible token destruction to ensure the sustainable development of the ecosystem.
2. Core Mechanism
In simple terms, Akash's cloud computing market concentrates and redistributes idle computing processing power to customers in need. Akash's "super cloud" connects customers with providers through transparent distributed leasing services and retains the advantages of decentralized computing through the Akash blockchain. By establishing an open and transparent market, users can freely publish resource requirements and allow global resource providers to bid in real time, reducing the cost of cloud services. According to Messari's report, Akash's cost of the same hardware is much lower than that of other cloud providers.
The flexibility of the protocol allows mobility between providers while providing performance benefits from global deployment. In turn, providers can earn profits from unused capacity.
Through the process of virtualization, computer resources are split into containerized applications. These "containers" are then rented to "tenants", buyers of cloud services on the network. "Providers" bid on these requests after they are verified as orders, and the lowest bidder for the requested resources wins the lease.
Through this process, each market participant receives an economic incentive to use the network. Providers profit by monetizing idle resources, while tenants benefit from lower costs. Market transactions all occur on the Akash blockchain.
The Akash blockchain is secured by the Delegated Proof of Stake (DPoS) consensus mechanism. As such, the network relies on a system of validators and delegators. Validators on the Akash Network use the tokens staked to them by delegators to submit new blocks to the blockchain through a voting process. Delegators stake their tokens to validators of their choice based on public information available on the platform.
The protocol also implements the Tendermint algorithm for increased speed and scalability. With its transparent and permissionless process, Akash represents the first open-source, decentralized cloud platform.
Akash NetworkMain Features:
Decentralized Cloud Computing: Built on a blockchain-based framework, Akash Network eliminates reliance on centralized cloud providers, providing greater security, transparency, and enhanced scalability for user data and transactions.
Permissionless Market: Akash Network provides an open marketplace that allows anyone with computing resources to become a cloud provider. Users can rent out their unused computing power, promoting competition and thus lowering prices.
Flexibility and Security: Developers can easily deploy applications and workloads, and the platform provides high security by using the native AKT token to ensure the integrity and authenticity of network transactions.
Staking and Incentive Mechanism: AKT token holders can participate in the network by staking their tokens, which not only helps to secure the network but also earns them rewards.
Interoperability Ecosystem: Akash Network is designed to be blockchain agnostic and built on the Cosmos SDK, allowing easy integration with other blockchain networks and promoting cross-chain cooperation.
Environmentally Friendly: Compared with traditional cloud services, Akash Network is more energy-efficient. The network's consensus mechanism is based on proof of stake, which is more environmentally friendly than proof of work used by many other blockchain networks.
Graphics Processing Units (GPUs)
A unique advantage of Akash Network is its GPU (Graphics Processing Unit) marketplace, which is a transformative feature for AI hosting. Through its decentralized cloud, Akash Network provides a platform where individuals and businesses can rent out their idle GPU resources to those who need them, especially AI developers and researchers.
This feature is groundbreaking mainly because:
Cost-Effectiveness: Traditional cloud services are costly when it comes to renting GPUs for AI processing. Akash Network's open marketplace promotes competition and reduces the cost of GPU rental, making it affordable for AI researchers and developers.
Scalability and Performance: AI developers can easily scale their operations and computing power without the limitations of traditional cloud infrastructure, which means AI models can be trained and deployed faster.
Security and Privacy: AI applications require the processing of sensitive data. Akash Network’s blockchain framework ensures that data is handled securely and transparently without the vulnerabilities of centralized systems.
Democratizing AI: By lowering the cost and accessibility barrier, Akash Network enables a wider range of individuals and organizations to participate in AI development and hosting, promoting innovation and technological advancement.
Eco-friendly Resource Utilization: By efficiently utilizing idle GPU resources through its marketplace, Akash Network significantly reduces environmental impact, significantly reducing the ecological footprint compared to building and maintaining dedicated data centers.
3. AKT Token
AKT is the native cryptocurrency of the Akash Network, whose contracts are built on the Cosmos blockchain and count as an automated market maker (AMM). It is essential for securing the network, executing transactions and contracts, and incentivizing community participation through staking and rewards. As the ecosystem grows, AKT is expected to play an important role in supporting and protecting decentralized cloud services.
AKT's main features and uses:
1. Network security and governance
AKT tokens, as a staking medium, enhance the security of the network. By staking AKT, users can participate in the governance of Akash Network, and the voting weight is determined by the number and duration of their staked tokens, which promotes the decentralized decision-making process of the network.
2. Lease settlement unit
AKT is the payment unit for leasing cloud resources. Akash sets different fee rates to regulate supply and demand. For example, the fee charged for AKT payment is 4%, while the fee for payment using USDC is 20%. Such a strategy not only regulates market supply and demand, but also increases the practical value of AKT.
3. Inflation and Token Distribution
Akash sets an annual inflation rate of up to 13%, and a portion of inflation revenue and handling fee revenue is allocated to the community pool for public funds, incentives, and possible token destruction. Such a mechanism is designed to ensure the sustainable development and value circulation of the ecosystem.
4. Market Pricing Benchmark
AKT tokens also serve as a benchmark for market pricing, determining the cost of resource leasing. This role emphasizes the core position of AKT in the Akash ecosystem, which is an important consideration for both resource suppliers and consumers.
5. Liquidity and Supply
As of March 20, 2024, the circulating supply of AKT is about 231 million, and all tokens have been fully unlocked, and no longer face high unlocking pressure. The current main circulation increase comes from inflation incentives, with a maximum supply of about 389 million. The pledge ratio is relatively high, with about 133 million AKT used for pledge, accounting for about 57.8%.
6. Liquidity
AKT is mainly traded on central exchanges such as KuCoin, Kraken and Gate. It is worth noting that AKT has not yet been listed on large first-tier exchanges such as Binance, which may affect its popularity and liquidity in specific regions. However, AKT has been listed on Coinbase, which may enhance its market appeal and investment potential.
As of now, the price of AKT tokens is $4.12 each, down 6.59% in the past 24 hours. The market capitalization is $958 million, ranking 100th. The 24-hour trading volume is about $7.59 million, with a ratio of 0.79% to the market capitalization. The circulating supply of AKT is 232 million, accounting for 59.83% of the total supply. The total supply and maximum supply are both 232 million AKT. If the maximum supply is taken into account, the fully diluted market capitalization of AKT is about $1.6 billion.
From the chart, AKT has experienced price fluctuations in recent times and is currently in a downward trend. Such market performance may be related to volatility in the overall crypto market, news events or updates specific to Akash Network. Investors and users should consider these market dynamics and exercise appropriate risk management when considering purchasing or holding AKT tokens.
AKT Price Prediction:
2024 Forecast: According to different sources, AKT price predictions vary by the end of 2024, ranging from $4.43 to $7.33.
2025 Forecast: By 2025, forecasts show that AKT's price may reach $8.60, with some forecasts going as high as $8.13.
2030 Long-Term Forecast: For a longer-term outlook, AKT price predictions by 2030 range from $2,033 to $4,860.
Key Factors Predicted to Impact Price:
Market Sentiment: Positive market sentiment towards Akash Network, continued development, and potential partnerships can be considered a bullish scenario, with the expectation that AKT could reach approximately $5 in the coming months.
Broad Market Dynamics: AKT could benefit if the market experiences a bull run; however, AKT could also decline significantly if the market crashes.
Akash Network Internal Developments: Successful product launches, new partnerships, and increased user adoption could drive price increases.
Regulatory Environment: Changes in the regulatory environment could impact the adoption and usage of cryptocurrencies, and in turn, the price of AKT.
Competition: Competition from other cloud computing platforms, both centralized and decentralized, could limit AKT’s growth.
4. Current Situation Analysis and Future Forecast
Akash currently has abundant computing resources, including a large number of CPUs and GPUs, which provides a stable and efficient foundation for processing complex computing tasks. In addition, Akash's GPU utilization rate remains at a high level, indicating that its computing resources are fully utilized, reflecting strong market demand and platform attractiveness. By establishing an open source community and cooperating with other decentralized protocols, Akash has also attracted developers and projects, further enhancing the vitality and innovation capabilities of its ecosystem.
However, the decentralized computing market is highly competitive, and Akash Network faces challenges from competitors such as Render, io.net, and Gensyn.
Specifically, Render and io.net have more or higher-quality computing resources in some aspects compared to Akash. In particular, io.net has far more computing resources in terms of quantity and quality than Akash, partly because it attracts computing resources through attractive airdrop incentives. Gensyn focuses on AI model training, which is different from Akash in business direction, but still constitutes a competitive relationship.
Image source @Metrics Ventures
Akash Network Competitive Advantages and Challenges
Advantages: Akash's advantages lie in its stable supply of computing resources, high utilization rate, and actively built developer community and ecological cooperation. These factors together strengthen Akash's market position and competitiveness.
Challenges: Competitors such as io.net quickly increase computing resources through incentive mechanisms, and Akash needs to compete with other projects in the field of GPU computing power. In addition, the continued growth and demand verification of the decentralized computing power market are also important challenges facing Akash.
Conclusion and Outlook
As the core target of the decentralized computing power track, Akash Network has strong market competitiveness due to its advantages in computing power resources, utilization rate and ecosystem construction. However, in the face of fierce market competition and a rapidly changing technological environment, Akash still needs to continue to optimize its platform, enhance the quality and quantity of computing power resources, and expand its service scope in order to maintain and enhance its market leadership. At the same time, Akash should continue to invest in developer friendliness and platform usability to attract more users and developers and further consolidate its competitive advantage in the decentralized computing power market.
As the cost of AI model training and reasoning drops significantly, more and more companies and individuals will build their own AI models, and AI will become popular around the world and penetrate into all aspects of society.
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