Akash leverages the disruptive power of blockchain technology to decentralize cloud computing infrastructure. Through its open-source, transparent cloud computing platform, many believe the Akash Network could challenge today's internet giants like Amazon Web Services (AWS), Google Cloud Platform (GCP), and Microsoft Azure.
But what exactly is Akash, how does it work, and what are its benefits and limitations? Read on to find out.
Understanding Akash Network
Cloud computing is the backbone of the modern Internet. Nearly every web application relies on cloud services for hosting and user delivery. However, most of this technology is concentrated in the hands of Amazon, Google, and Microsoft. In fact, it's estimated that these three companies alone host over 54% of global Internet traffic. This creates a centralized Internet by nature, which also introduces the risk of impacting millions of users should one of these services experience an outage.
The Akash Network provides a decentralized alternative to traditional cloud computing companies. Through a permissionless marketplace, buyers with computing needs and sellers with infrastructure can interact with each other within a fair pricing structure.
A Brief History of Akash
The Akash Network was launched in 2018 by Overclock Labs, a cloud services company founded by Greg Osuri and Adam Bozanich. After two years of testing, the Akash mainnet launched in September 2020.
Since its launch, the network has undergone several periodic upgrades to improve performance and introduce new features. One of the most notable improvements occurred in September 2023 with the addition of GPU support. Due to the rapid growth of artificial intelligence (AI), there is now a substantial need for advanced GPU resources. This upgrade brought with it the launch of Akash ML, an open marketplace for GPUs optimized for AI applications.
How the Akash Network Operates
To understand how the Akash Network works, you must first understand how traditional cloud computing companies operate. If you are a developer, you likely sign up with one of the three major providers: AWS, GCP, or Azure. You typically choose from a limited range of plans, often with fixed pricing, paid on a monthly basis. You might also face limitations regarding served locations and a lack of competitive pricing.
At first glance, these factors may not seem significant if you are just starting out. However, as you scale, you could encounter significant obstacles. First, plans can become expensive as you grow, and it is typically not possible to negotiate competitive pricing with traditional providers. You might also lack the necessary tools to optimize your application effectively. If you decide to migrate your application, you could face additional problems like vendor lock-in and long-term contracts designed to deter customers from moving to a better platform.
Akash's decentralized, open-source cloud computing marketplace aims to solve these limitations. Here, sellers are called "providers," and buyers are "tenants," reflecting the novel approach adopted by Akash.
Providers
Providers on the Akash Network supply the cloud computing infrastructure. Anyone can become a provider, including cloud companies, data centers, and even individual server operators. You need technical knowledge to set up and start operating as a professional provider. However, Akash offers an easy-to-use desktop application called Praetor to support those who wish to become providers. Interested parties can download the application and offer computing resources through a simplified user interface. Both individuals and companies can earn AKT tokens by offering their unused resources.
Tenants
Tenants are those who want to purchase cloud computing services on the Akash Network. As a tenant, you can start with a custom model or application and choose a provider that fits your needs. Once everything is ready, you can deploy and track your application without difficulties.
The Akash Network uses Docker, a Linux-based virtualization tool. It simplifies deployment by placing applications and their dependencies into containers. Akash offers popular applications like WordPress in pre-configured containers. The user only has to choose the amount of resources needed to run the container. If necessary, users can also bring their own custom containers and host them on Akash.
All of this can be done on the Akash Console and paid for with AKT tokens. The platform allows users to register with just a wallet, without requiring them to provide any personal details.
The Akash Marketplace
The platform connecting providers with tenants is the Akash Marketplace, which records everything on the blockchain. When a tenant wants to deploy an application, they publish their specifications, such as the required CPU, memory, bandwidth, and the price they are willing to pay. This creates an order on the marketplace's order book. Providers can see the open orders and make bids to fulfill them, providing a counteroffer with their available price and resources. The tenant can review the bids and choose the provider that best suits their needs. A lease contract is then established, and the application is deployed on the provider's infrastructure.
All transactions on the marketplace use the AKT token and are also recorded on the Akash blockchain.
Akash for AI
In its early years, Akash only offered cloud computing services for application hosting. However, with the rise of machine learning and AI, Akash identified a new opportunity. Most AI applications require significant GPU computing power, which is expensive for individuals and small businesses. This factor explains why many believe AI is at risk of being controlled by the few companies that can afford to invest heavily in it.
Similar to its standard computing model, Akash launched a new GPU network for AI applications. Anyone with powerful GPUs can rent them out when they are not in use. Those who want to deploy AI models can access the tools they need and pay only for the time used.
For example, the NVIDIA H100 is a popular GPU used for AI applications. However, it costs around $30,000 and often has a long backlog of orders. On Akash, developers can rent equally powerful GPUs for a fraction of the cost, as there are no upfront expenses, and they only pay for what is used.
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AKT Tokenomics and Distribution
AKT is the native token of Akash and has three primary use cases:
Market Currency: AKT is used on the Akash Marketplace by tenants to purchase computing resources. Similarly, providers are also paid in AKT tokens.
Governance: AKT also acts as a governance token, allowing users to participate in shaping the future of the Akash Network. AKT holders can vote on proposals that can improve the network and impact token supply factors, such as the inflation rate.
Security: Akash is a proof-of-stake (PoS) blockchain, and AKT is used to secure it. Users can stake AKT tokens to help validate transactions and earn rewards for doing so.
Akash raised $800,000 in 2020 through an Initial Exchange Offering (IEO) and an additional $2 million through private sales. Currently, AKT has a circulating supply of 232 million tokens, with a maximum cap of 388 million. The majority of tokens were reserved for mining rewards, with a smaller portion allocated to the foundation, the team, and investors.
The launch of AKT 2.0 introduced maker and taker fees. These fees are used to fund the Incentive Distribution Pool (IDP) to support network participants and growth.
Benefits of the Akash Network
- Offers a way for anyone to monetize their unused computing resources.
- A blockchain-based solution providing a secure, transparent platform for buyers and sellers.
- Cost-effective, with multiple options for buyers to choose from.
- No KYC or personal details required to deploy applications.
- Easy application deployment with support for industry-standard Docker.
- No vendor lock-in; users can choose a different provider if unsatisfied.
- One-click deployment solutions for popular applications.
- Community-driven decision-making, with AKT also functioning as a governance token.
Limitations of the Akash Network
- AKT is the primary token for users. Its volatility compared to stablecoins may be less attractive to potential holders.
- The network's total capacity is low compared to some of the largest cloud service providers.
- Akash has been on the market for nearly four years, but many believe it has a long way to go in terms of mainstream adoption. Challenging well-established internet giants like Amazon and Google will not be easy.
- Some aspects of the Akash Network can be complex for beginners to understand.
- Akash is not the only product in the market. It faces competition from other decentralized cloud protocols.
Frequently Asked Questions
What is the main goal of the Akash Network?
Akash aims to create a decentralized marketplace for cloud computing, challenging the centralized model dominated by major tech companies. It allows anyone to buy and sell computing resources in an open, efficient, and cost-effective market.
How do users pay for services on Akash?
Services on the Akash Network are primarily paid for using its native cryptocurrency, the AKT token. This token is used for all transactions within the marketplace, including payments from tenants to providers.
Can I use Akash to host a standard website?
Yes, you can host standard websites and applications on Akash. The platform supports Docker containers, making it compatible with a wide range of web applications, including popular content management systems like WordPress.
What makes Akash different from traditional cloud providers?
Key differences include its decentralized structure, which reduces reliance on single providers; a competitive marketplace model that can lower costs; no vendor lock-in; and greater privacy since no personal identification is required to use the core services.
Is Akash suitable for GPU-intensive tasks like AI model training?
Yes, following its upgrade to support GPUs, Akash has become a viable platform for AI and machine learning workloads. Users can rent powerful GPUs from a global network of providers, often at a lower cost than traditional cloud options.
Who can become a provider on the Akash Network?
Virtually anyone with unused computing resources can become a provider. This includes data centers, businesses with spare server capacity, and even individuals with powerful computers, provided they have the technical ability to set up the required software.
Final Thoughts
In short, Akash is seeking to redefine Internet infrastructure.
As a project that has been operating in the blockchain space for several years, Akash is not just a concept but a fully functional product backed by a thriving community.
Akash has demonstrated its commitment to network growth and evolution through numerous upgrades and the launch of new use cases into the market. Its native token, AKT, with its robust governance model and incentive structure, could position the network as a significant participant in this space.
With the growing demand for computing and GPU capacity, rather than directly displacing traditional cloud computing companies, Akash could thrive as an alternative provider with its unique features and decentralized approach.