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aich committed Oct 30, 2024
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Expand Up @@ -38,15 +38,15 @@ Diode’s CEO, Hans Rempel, and [Moonbeam’s](https://moonbeam.network) Directo

A basic tenant of Diode is that the Internet’s system of security is hopelessly outdated, and is being increasingly subverted - to the point that privacy and security over the Internet has mostly become about how unimportant you are. Because of this, organizations who cannot afford data leaks spend significant resources in creating their own private cyber security systems. However, that doesn’t work for medium business, it doesn’t work for individuals, and it doesn’t work for SaaS applications (whose apps need to work for nearly everyone).

Diode’s solution to this monumental problem is to create a new type of secure network infrastructure that can be used to connect any type of device and any type of application using end to end encryption. We do this via our DePIN network - https://diode.io/network. The network nodes are blockchain native “mathematically secured” points of presence that simply bridge tunneled connections from one device to another device. How that tunnel is used is fully up to the application using the tunnel and the user using the application.
Diode’s solution to this monumental problem is to create a new type of secure network infrastructure that can be used to connect any type of device and any type of application using end to end encryption. We do this via our [DePIN network](https://diode.io/products/network). The network nodes are blockchain native “mathematically secured” points of presence that simply bridge tunneled connections from one device to another device. How that tunnel is used is fully up to the application using the tunnel and the user using the application.

By deploying this capability as a DePIN, Diode nodes are already emerging in every region of the world, providing better security (all in-region connections, blockchain perimeter anchoring can’t be tampered) and faster performance (shorter hops) than anything else in existence today.
By deploying this capability as a DePIN, Diode nodes are already [emerging in every region of the world](https://diode.io/network), providing better security (all in-region connections, blockchain perimeter anchoring can’t be tampered) and faster performance (shorter hops) than anything else in existence today.

A core question for all DePINs is “what metric is being incentivized”? Like Helium, Diode’s core incentive metric is bandwidth - if a node transfers data, it gets reward for transferring it in proportion to the amount of data transferred. The $DIODE token is a utility token than pays for bandwidth.

# Diode as an RWA

Unlike [Helium](https://www.helium.com/), whose nodes require a physical device with a wireless antenna of some flavor, Diode nodes can be hosted anywhere - including in data centers on cheap virtual machines. The smallest “droplet” or even “spot VM” is sufficent to run a Diode node.
Unlike [Helium](https://www.helium.com/), whose nodes require a physical device with a wireless antenna of some flavor, Diode nodes can be hosted anywhere - including in data centers on cheap virtual machines. The smallest “droplet”, “spot VM”, or even Raspberry PI is sufficent to run a Diode node.

If the region in which the node is running has many people using the network, but does not have that many nodes, there is a supply-demand relationship that drives up the cost of bandwidth demoninated in [$DIODE](https://diode.foundation/docs/token.html). This incentivizes the ecosystem to bring more nodes online. If there is an over-supply of nodes in a region, then the cost of bandwidth will be driven down until it reaches a point that some node operators are no longer willing to maintain nodes. This market-driven approach to regional supply and demand means that every region will modulate the amount of $DIODE per amount of bandwidth, and that changing demand will generate a response in supply.

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