Akash Network is one of the most exciting projects in the whole Cosmos ecosystem. Why? Because it disrupts the current (centralized) market standard of cloud computing, one of the fastest-growing sectors in the world! This Cosmos 101 article will closely look at how Akash works and how the project’s tokenomics look like.
What is Akash?
Akash Network is a decentralized and secure cloud computing marketplace built with the Cosmos SDK. It focuses on connecting those who need computing resources with those who have the capacities to lease. At the time of writing, the project is the sixth biggest zone in the Cosmos ecosystem.
Facts about the cloud computing industry
The global cloud computing market reached $250 billion in 2021 and is predicted to grow at an annual rate of almost 18%. Experts expect a market size of $800 billion by 2028! Although the cloud infrastructure industry is that valuable, monopolies reign the market! The biggest cloud service providers Amazon Cloud Services (AWS), Microsoft Azure, and Google Cloud, dominate with a combined market share of 61%. Many expect this figure to increase even further!
Despite the exponential growth of cloud computing in the past, all that glitters is not gold. Why? Because the providers are inflexible and complicated, but also show severe problems, including security concerns and cost issues.
As all service providers mentioned above are centralized companies, there is a high risk of attacks on the underlying infrastructure. Furthermore, criminals can hack interfaces and APIs more easily.
For the most part, cloud computing can save businesses money, but some key issues still exist. Undoubtedly cloud cost optimization is the crucial aspect here. An excellent example of the high inflexibility of centralized cloud providers is high recurring costs with vendor lock-in agreements. Additionally, certain cloud services are very restrictive. Cloud providers do not offer services for all kinds of demand. If your business does not fit into the picture, you have to pay higher costs.
How does Akash work?
In general Akash consists of two main components: the network and the platform. While the network represents the on-chain decentralized marketplace explained above, the Akash Platform is an off-chain deployment infrastructure used for hosting and managing workloads. It consists of a set of cloud management services.
Akash Network acts as a supercloud that provides a unified layer above all providers on the marketplace. As a result, clients have one single cloud platform, regardless of which cloud provider they use.
The network’s clients profit from its usability, flexibility to move between different cloud providers, and cost advantages. On the other hand, cloud providers benefit from earning profits by making either dedicated or temporarily unused capacity available.
Providers lease these computer units (CPUs) as container units on Akash. A container unit is a standard unit of software that packages up code and all its dependencies. This model ensures that applications run quickly and reliably from one environment to the other.
The role of blockchain in the Akash Network
All marketplace transactions take place on the Akash Blockchain. To lease a container, the client requests a deployment by specifying the type of unit and the amount they need. Afterward, an order is created in the order book if validators approve the transaction. The provider that matches all requirements then places a bid and the provider that bids the lowest amount on order wins. For every successful lease, a portion of the lease amount is paid to the blockchain.
How efficient is Akash?
The protocol competes at a 10x lower rate than the market standard. The serverless computing platform is compatible with all cloud providers and applications that run on the cloud. Hence it is easy to have Akash integrated with any company’s existing technology stack.
Furthermore, Akash leverages 85% of the underutilized cloud capacity in 8.4 million data centers worldwide. Otherwise, data centers would waste these capacities.
The role of AKT / Tokenomics
Akash Token (AKT) is the platform’s native utility token, used as the primary means to govern, secure the blockchain, incentivize participants, and provide a default mechanism to store and exchange value. Overall, AKT has three main functions: to resolve, reward, and reserve.
MapOfZones (number of IBC transfers): https://mapofzones.com/?testnet=false&period=24&tableOrderBy=totalIbcTxs&tableOrderSort=desc