No Way It Won't Work

Photo provided by EMC

As interest in artificial intelligence (AI) continues to rise, there is a growing trend of cryptocurrency projects attempting to combine AI with blockchain.

Among AI-related cryptocurrency projects, the most representative type is the decentralized graphics processing unit (GPU) project that rents out GPUs. Decentralized GPUs are a type of decentralized physical infrastructure network (DePIN), which refers to projects that upload unused computing power to the blockchain and rent it out to developers or startups in need of computing power.

EdgeMatrixChain (EMC) is also one of the DePIN projects that operate GPU rental services. However, it is evaluated as being differentiated from other GPU rental DePINs by enabling DeFi and creative platform provision using Layer 1 blockchain. Previously, in August, EMC attracted a total investment of $20 million from venture capital firms such as P2 Ventures and Amber Group to develop its Layer 1 blockchain.

Why Do We Need Decentralized GPUs?

Graphics Processing Unit. /Photo provided by EMC

Decentralized GPU projects have emerged as a solution to the GPU acquisition problem, which is currently the most important issue in the AI industry.

Since the emergence of Open AI's Chat GPT, everyone has jumped into AI development, causing a surge in GPU demand while supply remains severely insufficient. As a result, high-performance GPUs used in current AI development are priced at the level of a car. While big tech companies like Meta and Microsoft have no major issues purchasing expensive GPUs, startups and individual developers face difficulties in terms of cost.

The demand for GPUs can be glimpsed from Nvidia's third-quarter report, which virtually monopolizes the GPU market. Nvidia reported that its revenue and net income surged by 94% and 106% year-on-year, respectively, to $33.16 billion and $19.39 billion in its third-quarter earnings announcement. These figures significantly exceeded market expectations.

Decentralized GPU DePINs have become an alternative that can significantly reduce the cost of GPU computing resources, addressing these issues. Binance highlighted in its first-half report this year that "as interest in AI has surged, the cost of computing resources such as GPUs has increased," and "decentralized GPU DePINs have emerged as a cost-effective alternative."

There is also hidden demand for decentralized GPUs. These are AI developers in China who have been sanctioned by the United States. According to the Wall Street Journal, Chinese AI developers have turned to decentralized GPUs as an alternative after being blocked by Amazon Web Services. The media cited EMC as an example, evaluating that decentralized GPUs, with features such as anonymity through smart contracts, are becoming an attractive option for Chinese AI developers.

EMC, a One-Stop Platform for AI

Alex Go, founder of EMC, explaining Nvidia H100 cluster SuperPOD at Token 2049. /Photo provided by EMC

As previously explained, EMC is a project that rents out the computing power of GPUs. To this end, EMC currently has secured 274 nodes on its blockchain and registered over 3,000 GPUs. The GPUs provided by EMC include Nvidia A100, GeForce RTX 4090, and GeForce RTX 3090.

In particular, the cluster 'SuperPOD,' made by assembling 1,024 'Nvidia H100' GPUs, is considered EMC's strength. Previously, EMC participated in the 'Singapore Token 2049' conference and demonstrated a real-time demo of SuperPOD.

EMC not only rents out GPUs but also provides users with various AI-related services. For example, it offers a platform business that allows users to develop and content AI more easily. The EMC AI platform, EMC HUB, includes ▲ AI agent Jarvis Bot that can generate various content, ▲ creative work trading application OmniMuse, and ▲ 3D content generation application ZoZoWorld.

Additionally, EMC assists in building networks suitable for AI use. Specifically, it has implemented technologies such as smart routing and data caching to achieve low latency and high transaction throughput in the network. EMC stated, "Our goal is to become a platform that encompasses almost everything in the AI field," adding, "Developers will be able to smoothly test and launch their AI models on the EMC network."

Furthermore, EMC is also providing DeFi services using GPUs. Currently, anyone within EMC can purchase the computing power of Nvidia H100 GPUs in token form, and by staking it through EMC's DeFi, they can earn additional income of about 2.7% to 7.1% annually, depending on the period. Currently, about 2.6 million EMC tokens are staked in this DeFi service.

Photo captured from CoinMarketCap

According to CoinMarketCap, EMC tokens are trading at $0.079 as of 10 a.m. on the 6th, down 4.91% from the previous day. The currently circulating EMC tokens amount to about 30 million, accounting for 3% of the total supply (about 1 billion). The market capitalization is around $2.37 million.

Meanwhile, EMC is generating an annual income of about $15 million. Although the business scale cannot be considered large yet, the outlook for decentralized GPU projects is generally positive. Data analytics firm Nansen, in a report published with MetaStreet, projected that "considering DeFi income from GPU rental services, tokenomics, and GPU rental revenue, the total revenue of these services could surge by at least 30% to as much as 200%."