Akash has capitalized on the disruptive force of blockchain technology in computing by advancing the decentralized of cloud computing infrastructure. Through its open-source and transparent cloud computing platform, many believe the Akash network could challenge today’s internet giants of Amazon Web Service (AWS), Google Cloud Platform (GCP), and Microsoft Azure.
But what exactly is Akash, how does it work, and what are the network’s benefits and limitations? Read on to find out.
What is Akash?
Cloud computing forms the backbone of the internet today. Almost every internet application uses cloud computing to host and serve its customers. However, most of the 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 internet traffic. This makes the internet centralized in nature, but also risks impacting millions of people if just one of these services were to go down.
The Akash network provides a decentralized alternative to traditional cloud computing companies. Through a permissionless marketplace, buyers with computing requirements and sellers with infrastructure can interact with each other through a fair pricing structure.
History of Akash
The Akash network was launched in 2018 by Overclock Labs, a cloud service company founded by Greg Osuri and Adam Bozanchi. After two years of testing, the Akash mainnet went live in September 2020.
Since launch, the network has undergone various periodical upgrades to improve performance and introduce new features. One of the most notable upgrades came in September 2023 when support for GPUs was added. Due to the rapid growth of AI, there's now a substantial need for advanced GPU capabilities. The upgrade brought with it the launch of Akash ML, an open-source marketplace for GPUs optimized for AI applications.
How does the Akash network work?
To understand how the Akash network works, you must first understand how traditional cloud computing companies operate. If you’re a developer, you’ll likely sign up to one of the big three providers: AWS, GCP, or Azure. You’ll typically be offered a limited choice of plans, often with fixed pricing, which is paid monthly. You may face limitations regarding the locations served, and encounter a lack of competitive pricing.
On first glance, these factors might not seem significant if you’re just starting out. However, as you scale, you could end up meeting significant roadblocks. First, the plans can be expensive if you want to scale, and you typically can't negotiate competitive pricing with traditional providers. You might also not be offered the tools required to optimize your application. If you end up deciding to move your application, you could face more problems, such as vendor lock-ins and long contracts to deter customers from moving to a better platform.
Akash’s open-source, decentralized cloud computing marketplace aims to address these limitations. Here, the sellers are called “providers”, and buyers are “tenants”, reflecting the new approach taken by Akash.
Providers
Akash network providers deliver the cloud computing infrastructure. Anyone can become a provider, including cloud companies, data centers, and even individual server operators. Technical knowledge is required to set up and get started as a professional provider. However, Akash offers an easy-to-use desktop application called Praetor to support those looking to be a provider. Interested parties can download the app and offer compute resources on a streamlined UI. Both individuals and companies can earn AKT tokens for offering their resources.
Tenants
Tenants are the ones who want to buy cloud computing services from the Akash network. As a tenant, you can start with a template or your own custom application and then choose a provider that fits your needs. Once you’re ready, you can deploy and track your application seamlessly.
The Akash network uses Docker, a Linux-based virtualization tool. It simplifies deployment by enclosing applications and their dependencies within containers. Akash offers popular applications such as Wordpress on containers. The user only has to choose the amount of resources required to run the container. If needed, users can also bring their own containers and host them on Akash.
All of this can be done on Akash Console, and paid for using AKT tokens. The platform lets users sign up with just their wallet, without requiring them to provide any personal details.
Akash Marketplace
The platform that connects providers with tenants is the Akash Marketplace, which records everything on the blockchain. When a tenant wants to deploy an application, they post their specifications, such as the required CPU, memory, bandwidth, and the price they’re willing to pay. This represents an order on the marketplace’s order book. Providers can see the open orders in the order book and bid for them, and provide a counter-offer with the price and resources available shown. The tenant can review the bids and choose the provider that best suits their needs. Next, a lease is established and the application is deployed on the provider’s infrastructure.
All transactions on the marketplace use the AKT token, and they’re also recorded on the Akash blockchain.
Akash for AI
For the first few years, Akash only offered cloud computing services for hosting applications. However, with the rise of machine learning and AI, Akash saw 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 in AI.
Similar to Akash compute, Akash launched a new GPU network for AI applications. Anyone with powerful GPUs can rent them out when they’re not in use. Those looking to deploy AI models can access the tools they need and only pay for the time used.
For example, the NVIDIA H100 is a popular GPU used for AI applications. However, it costs about $30,000 and is heavily backordered. Developers can rent out equally powerful GPUs at a fraction of the cost, as there’s no upfront costs and they only pay for what’s used.
Tokenomics and distribution of AKT token
AKT is the native token of Akash, and it has three major use cases:
Marketplace currency: AKT is used on the Akash marketplace by tenants to buy computing resources. Similarly, providers are also paid in AKT tokens.
Governance: AKT also acts as a governance token for users to participate in the future of Akash's network. AKT holders can vote on proposals that could improve the network and impact token supply, 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 validate transactions, and gain tokens for doing so.
Akash raised $800,000 in 2020 through an IEO and another $2 million through private sales. AKT currently has a circulating supply of 232 million tokens, with a maximum cap of 388 million. Most of the tokens were reserved for mining rewards, with a small portion going to the foundation, team, and investors.
The launch of AKT 2.0 brought with it maker and taker fees. This fee is 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 that provides a secure and transparent platform for both buyers and sellers.
Cost-effective, with multiple options for buyers to choose from.
No KYC or personal details are required to deploy applications.
Easy to deploy applications with support for industry-standard docker.
No lock-ins, and users can choose a different provider if they’re unsatisfied with the current one.
Has ready-made solutions for popular applications that can be deployed with a single click.
Community gets to make major decisions, with AKT also doubling as a governance token.
Limitations of Akash Network
AKT is the main token used by users. However, its volatility compared to stable cryptocurrencies could be less desirable to potential holders.
The network capacity is low compared to some of the larger cloud service providers.
Akash has been in the market for almost four years, but many believe it has a long way to go with adoption. Disrupting well-established internet giants like Amazon and Google won't be easy.
Some aspects of the Akash network can be complex for beginners to understand.
Akash isn't the only product on the market. Its competitors include ICP Protocol.
The final word
Put simply, Akash is looking to redefine the internet’s infrastructure.
As a project that’s been operating in the blockchain space for a few years now, Akash is more than just a concept but a fully fledged working product backed by a thriving community.
Akash has shown its commitment to growth and evolution for the network with various updates made and new use cases brought to the market. The native AKT token, with its strong governance model and incentive structure, could make the network an important player in this space.
With growing demand for both computing and GPU power, rather than disrupting traditional cloud computing companies, Akash could succeed as an alternate provider with its own unique features.
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